10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[Mark One]

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2005

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number 0-26482

TRIKON TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

Delaware	95-4054321
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

Ringland Way, Newport, South Wales NP18 2TA, United Kingdom
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code 44-1633-414-000

Not Applicable

Former name, former address and former fiscal year, if changed since last report

Indicate by check whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).    Yes  x    No  ¨

As of May 3, 2005, the total number of outstanding shares of the Registrant’s common stock was 15,754,985.

Trikon Technologies, Inc.

INDEX

		PAGE NUMBER
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets at March 31, 2005 and December 31, 2004	3
	Condensed Consolidated Statements of Operations for the Three Months ended March 31, 2005 and March 31, 2004	4
	Condensed Consolidated Statements of Cash Flows for the Three Months ended March 31, 2005 and March 31, 2004	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	10
Item 3.	Quantitative and Qualitative Disclosure About Market Risk	22
Item 4.	Controls and Procedures	23
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	24
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	24
Item 3.	Defaults Upon Senior Securities	24
Item 4.	Submission of Matters to a Vote of Security Holders	24
Item 5.	Other Information	24
Item 6.	Exhibits	24

2

PART I - FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars, except share data)

	March 31 2005			December 31, 2004
	(Unaudited)			(Note A)
Assets
Current assets :
Cash and cash equivalents	$	18,489		$	21,202
Accounts receivable, net		6,008			6,654
Inventories, net		18,544			16,543
Prepaid and other current assets		1,258			2,203
Total current assets		44,299			46,602
Property, equipment and leasehold improvements, net		11,446			13,597
Demonstration systems, net		4,009			551
Other assets		366			391
Total assets	$	60,120		$	61,141
Liabilities and shareholders’ equity
Current liabilities:
Short term borrowing	$	9,450		$	9,600
Accounts payable		7,713			5,709
Accrued expenses		1,315			1,453
Deferred revenue		646			541
Warranty and related expenses		1,038			1,171
Current portion of long term debt		220			281
Other current liabilities		974			971
Total current liabilities		21,356			19,726
Long-term debt less current portion		81			91
Other noncurrent liabilities .		734			782
	$	22,171		$	20,599
Shareholders’ equity:
Preferred Stock:
Authorized shares — 20,000,000 Issued and outstanding — None at March 31, 2005 and at December 31, 2004		—			—
Common Stock, $0.001 par value:
Authorized shares — 50,000,000 Issued and outstanding — 15,754,985 at March 31, 2005 and at December 31, 2004		261,416			261,416
Accumulated other comprehensive income		2,667			2,886
Accumulated deficit		(226,134	)		(223,760	)
Total shareholders’ equity		37,949			40,542
Total liabilities and shareholders’ equity	$	60,120		$	61,141

See Notes to Unaudited Condensed Consolidated Financial Statements.

3

Trikon Technologies, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(In thousands of U.S. dollars, except share and per share data)

	Three Months Ended
	March 31, 2005			March 31, 2004
				(As restated)
Revenues:
Product revenues	$	5,796		$	6,738
License revenues		2,015			43
		7,811			6,781
Costs and expenses:
Cost of goods sold		3,922			5,786
Research and development		2,277			2,897
Selling, general and administrative		3,696			4,509
		9,895			13,192
Loss from operations		(2,084	)		(6,411	)
Foreign currency (losses) gains		(260	)		623
Interest income, net		26			66
Loss before income tax charge		(2,318	)		(5,722	)
Income tax charge		56			65
Net loss	$	(2,374	)	$	(5,787	)
Loss per share data:
Basic	$	(0.15	)	$	(0.37	)
Diluted	$	(0.15	)	$	(0.37	)
Weighted average common shares used in the calculation:
Basic		15,755			15,702
Diluted		15,755			15,702

See Notes to Unaudited Condensed Consolidated Financial Statements.

4

Trikon Technologies, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In thousands)

	Three Months Ended
	March 31, 2005			March 31, 2004
				(As restated)
Operating Activities
Net loss	$	(2,374	)	$	(5,787	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization of property plant and equipment		1,231			1,392
Gain on disposal of property plant and equipment		—			(10	)
Provision for gain on accounts receivable		(57	)		9
Changes in operating assets and liabilities:
Accounts receivable		703			3,416
Inventories (including demonstration systems)		(5,459	)		(584	)
Other current assets		945			1,218
Accounts payable and other liabilities		1,796			566
Income tax payable		45			(67	)
Net cash provided by (used in) operating activities		(3,170	)		153
Investing Activities
Purchases of property, equipment and leasehold improvements		(64	)		(1,085	)
Proceeds from sale of property, plant and equipment		745			329
Other assets and liabilities		(23	)		(45	)
Net cash used in investing activities		658			(801	)
Financing Activities
Issuance of common stock		—			172
Borrowings under short term loan		(150	)		9,200
Repayments under bank credit lines		—			(11,188	)
Payments on capital lease obligations		(71	)		(152	)
Net cash used in financing activities		(221	)		(1,968	)
Effect of exchange rate changes in cash		20			(6	)
Net decrease in cash and cash equivalents		(2,713	)		(2,622	)
Cash and cash equivalents at beginning of period		21,202			31,646
Cash and cash equivalents at end of period	$	18,489		$	29,024

See Notes to Unaudited Condensed Consolidated Financial Statements.

5

Trikon Technologies, Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

March 31, 2005

NOTE A BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements include the accounts of Trikon Technologies, Inc. (the “Company”) and its subsidiaries. All material intercompany balances and transactions have been eliminated.

The condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements.

In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The operating results for the three months ended March 31, 2005 are not necessarily indicative of the results that may be expected for the year ending December 31, 2005.

In May 2005, the Company decided to restate certain of its previously issued financial statements to reflect: (i) the classification of accounts receivable and deferred revenues on contracts with a portion of the contract price that is withheld until final acceptance: (ii) the timing of recognition of costs on those contracts: and (iii) the allocation of facilities cost. (See notes 13 and 14 to the consolidated financial statements on Form 10-K/A for the fiscal year ended December 31, 2004).

The balance sheet at December 31, 2004 has been derived from the audited consolidated financial statements at that date included in the Company’s Form 10-K/A for the year ended December 31, 2004, but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K, as amended by the Company’s amended report on Form 10-K/A for the year ended December 31, 2004.

On March 14, 2005, the Company entered into an agreement with Aviza Technology, Inc. for the joint development of control software for an existing Aviza process module (the “JDA”). The total development fee payable by Aviza to the Company under the JDA is $1.2 million. The development fee includes $900,000 payable upon delivery and sale by the Company to Aviza of one standard, unmodified Trikon transport module. The JDA acknowledges that such delivery and sale and related payment was completed in December 2004 prior to executing the JDA. The JDA includes a grant of license rights to Aviza with respect to the process module control software to be developed under the JDA. The total license fee payable by Aviza to the Company under the JDA is $ 4 million, half of which was paid on March 14, 2005, the other half of which is payable by Aviza on or before July 31, 2005.

NOTE B RECENT ACCOUNTING PRONOUNCEMENTS

As permitted by Statement of Financial Accounting Standard (“SFAS”) No. 123, “Accounting for Stock-Based Compensation”, the Company currently accounts for share-based payments to employees using Accounting Principles Board (“APB”) Opinion 25’s “Accounting for Stock Issued to Employees” intrinsic value method and, as such, generally recognizes no compensation cost for employee stock options. Accordingly, the adoption of SFAS 123(R)’s fair market value method will have a significant impact on the Company’s result of operations, although it will have no impact on its overall financial position. The impact of adoption of SFAS 123(R) cannot be predicted at this time because it will depend on levels of share-based payments granted in the future. However, had the Company adopted SFAS 123(R) in prior periods, the impact of that standard would have approximated the impact of SFAS 123 as described in the disclosure of pro forma net income and earnings per share in Note H to the consolidated financial statements. SFAS 123(R) also requires the benefit of tax deductions in excess of recognized compensation cost to be reported as a financing cash flow, rather than as an operating cash flow as required under current literature. This requirement is not expected to have a material effect on the Company’s financial condition or results of operations.

In November 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 151, “Inventory Costs an amendment of ARB No. 43, Chapter 4” (SFAS No. 151). SFAS No. 151 amends the guidance in ARB No. 43, Chapter 4, “Inventory Pricing,” to clarify the accounting for abnormal amounts of idle facility expense, handling costs and wasted material (spoilage). Among other provisions, SFAS 151 requires that such items be recognized as current-period charges, regardless of whether they meet the criterion of “so abnormal” as stated in ARB No. 43. SFAS No. 151 is effective for fiscal years beginning after June 15, 2005. The Company does not expect that adoption of SFAS No. 151 will have a material effect on its consolidated financial position, consolidated results of operations, or liquidity.

6

NOTE C INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out method) or market value. The components of inventory consist of the following:

	March 31, 2005		December 31, 2004
	(in thousands)
Customer service spares	$	2,554	$	2,723
Finished goods		2,474		—
Work in progress		4,405		6,172
Components		9,111		7,648
Total	$	18,544	$	16,543

NOTE D LIABILITIES

The components of other current liabilities are as follows:

	March 31, 2005		December 31, 2004
	(in thousands)
Customer deposits	$	25	$	26
Payroll taxes		708		693
Income taxes		82		80
Other		159		172
Total	$	974	$	971

Generally, the Company’s products are sold with a standard warranty, the period of which varies from 12 to 24 months, depending on a number of factors including the specific equipment purchased. The Company accounts for the estimated warranty cost as a charge to cost of sales at the time of delivery. The warranty cost is based upon historic product performance and is based on a rolling 12-month average of the historic cost per machine per warranty month outstanding.

Changes in the Company’s product warranty liability during the three months ended March 31, 2005 were as follows (in thousands):

Balance, January 1, 2005	$	1,171
Provisions for warranty		170
Consumption of reserves		(286	)
Translation adjustment		(17	)
Balance, March 31, 2005	$	1,038

7

NOTE E COMPREHENSIVE LOSS

Comprehensive loss is comprised of the following:

	Three Months Ended
	March 31, 2005			March 31, 2004
				(As restated)
	(In thousands)
Net loss	$	(2,374	)	$	(5,787	)
Foreign currency translation adjustments		(219	)		518
Total	$	(2,593	)	$	(5,269	)

NOTE F EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share:

	Three Months Ended
	March 31, 2005			March 31, 2004
				(As restated)
	(In thousands)
Numerator:
Net loss	$	(2,374	)	$	(5,787	)
Denominator:
Weighted average shares outstanding		15,755			15,702

Basic and diluted earnings per share are calculated in accordance with SFAS 128, “Earnings Per Share,” which specifies the computation, presentation and disclosure requirements for earnings per share.

The effect of the Company’s potential issuance of common shares from the Company’s stock option program is excluded from the diluted shares calculation in accordance with SFAS 128, as they are anti-dilutive when a loss is incurred.

NOTE G PREFERRED STOCK

The Board of Directors has the authority to issue up to 20,000,000 shares of Preferred Stock in one or more series with rights, preferences, privileges and restrictions to be determined at the Board’s discretion.

NOTE H STOCK BASED COMPENSATION EXPENSE

The Company has estimated the fair value of the options at the date of grant using a Black-Scholes option pricing model which was developed for use in estimating the value of traded options that have no vesting restrictions and are fully transferable.

The Company’s employee stock options have characteristics significantly different from those of traded options; therefore, the Black-Scholes option-pricing model may not provide a reliable measure of the fair value of the Company’s options.

No share-based payment expense was recognized under APB 25 for the three months ended March 31, 2005 or 2004. If compensation expense had been determined based on the grant date fair value as computed under the Black-Scholes option pricing model for awards in the three month periods ending March 31, 2005 and 2004 in

8

accordance with the provisions of SFAS No. 123 and SFAS No. 148, the Company’s net result and earnings per share would have been reduced to the pro forma amounts indicated below:

	Three Months Ended
	March 31, 2005			March 31, 2004
				(As restated)
	(In thousands)
Net loss as reported:	$	(2,374	)	$	(5,787	)
Pro forma compensation expense calculated on the fair value method:		(168	)		(272	)
Pro forma net loss:	$	(2,542	)	$	(6,059	)
Pro forma loss per common share:
Basic	$	(0.16	)	$	(0.39	)
Diluted	$	(0.16	)	$	(0.39	)

On February 9, 2005, the board of directors resolved to amend the outstanding option agreements held by Christopher Dobson, Nigel Wheeler and John Macneil to provide for full acceleration of options with a per share exercise price below $6.00 upon the completion of the proposed merger transaction with Aviza Technology, Inc.

Under FASB Interpretation No. 44, if an award is modified to accelerate vesting, a new measurement date results because the modification may allow the employee to vest in a option or award that would have otherwise been forfeited pursuant to the award’s original terms. While measurement of compensation is made at the date of the modification, the recognition of compensation expense, if any, depends on whether the employee ultimately retains an option or award that would otherwise have been forfeited under the option or award’s original vesting terms. Compensation is measured based on the award’s intrinsic value at the date of modification in excess of the award’s original intrinsic value.

At the date of modification the Company’s share price was below the exercise price of the options and therefore no compensation expense results from the acceleration.

9

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our condensed consolidated financial statements and notes thereto included elsewhere in this Report. This discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The forward-looking statements included herein and any expectations based on such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Factors that could cause actual results to differ materially include, without limitation, the length and severity of the continuing downturn in the semiconductor industry, the long sales cycle and implementation periods for Trikon’s systems, the acceptance of Trikon’s technologies and products, Trikon’s ability to respond to technological change, Trikon’s dependence on a limited number of customers and other factors such as those set forth below under the heading “Risk Factors” and the other risks and uncertainties described from time to time in our public announcements and SEC filings, including, without limitation, our Quarterly and Annual Reports on Form 10-Q, 10-K and 10-K/A, respectively.

OVERVIEW

Our business is to design, manufacture, market and sell advanced production equipment and spares and related support services that are used to process semiconductor wafers for the manufacture of integrated circuits. Due to the large unit prices associated with our systems (which typically vary between $0.8 million and $3.5 million), our backlog, shipments and revenues can be affected, positively or negatively, by a relatively small swing in orders.

Our products carry out processes to deposit and add/or remove materials on the surface of a wafer. In particular our products are used for chemical vapor deposition (CVD), physical vapor deposition (PVD) and plasma etch processes. We sell, install and service our systems to semiconductor manufacturers worldwide and our existing customers include a wide range of semiconductor companies, including large independent device makers. We use a direct sales model in all of our markets except in Asia, where we use a combination of direct sales and distributors.

From time to time we have licensed or sold technologies where we believe that this represented a more profitable way to exploit our development expenditure.

Recent Developments

On March 14, 2005, we entered into an Agreement and Plan of Merger with Aviza Technology, Inc., a privately held global supplier of thermal process and atomic layer deposition systems. Under the terms of the Merger Agreement, a wholly-owned subsidiary of New Athletics, Inc., a newly formed Delaware corporation, will merge with and into us, and a wholly-owned subsidiary of New Athletics, will merge with and into Aviza. Upon consummation of the mergers, we and Aviza will each continue as wholly-owned subsidiaries of New Athletics. The consummation of the merger is subject to the approval of our stockholders and other customary closing conditions. The requisite approval of the stockholders of Aviza has already been obtained. The merger is expected to close in the third quarter of 2005.

In addition, on March 14, 2005, we entered into an agreement for the joint development of control software for an existing Aviza process module (the “JDA”). The total development fee payable by Aviza to us under the JDA is $1.2 million. The development fee includes $900,000 payable upon delivery and sale by us to Aviza of one standard, unmodified Trikon transport module. The JDA acknowledges that such delivery and sale and related payment was completed in December 2004 prior to executing the JDA. The JDA also obligates Aviza to purchase, and us to sell, eight additional Trikon transport modules incorporating the developed software, all on a cost-plus-a specified percentage basis, and all within two years after the completion of the development work (for delivery no later than two and a half years after the date of the JDA).

The JDA includes a grant of license rights to Aviza with respect to the process-module control software to be developed under the JDA, and also with respect to certain manufacturing documentation and software source code for the existing Trikon transport module. The total license fee payable by Aviza to us under the JDA is $4 million, half of which was paid upon execution of the JDA, the other half of which is payable by Aviza on or before July 31, 2005. The JDA also specifies per-unit royalties that Aviza is to pay us for licensed products sold, subject to an overall cap of $2 million.

In May 2005, we decided to restate certain of our previously issued financial statements to reflect; (i) the classification of accounts receivable and deferred revenues on contracts with a portion of the contract price that is withheld until final acceptance; (ii) the timing of recognition of costs on those contracts; and (iii) the allocation of facilities cost. (See notes 13 and 14 to the consolidated financial statements on Form 10-K/A for the fiscal year ended December 31, 2004).

10

Critical Accounting Policies

General

Our discussion and analysis of the financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with United States generally accepted accounting principles.

A critical accounting policy is defined as one that is both material to the presentation of our financial statements and requires management to make difficult, subjective or complex judgments that could have a material effect on our financial condition and results of operations. Specifically, critical accounting estimates generally require us to make assumptions about matters that are highly uncertain at the time of the estimate; and if different estimates or judgments were used, the use of these estimates or judgments would have a material effect on our financial condition or results of operations.

The estimates and judgments we make that affect the reported amount of assets, liabilities, revenues and expenses are based on our historical experience and on various other factors, which we believe to be reasonable in the circumstances under which they are made. Actual results may differ from these estimates under different assumptions or conditions. We consider our accounting policies related to revenue recognition, foreign currency translation, the valuation of inventories including demonstration inventory and accounting for the costs of installation and warranty obligations to be critical accounting policies.

Revenue Recognition

We derive our revenues from three sources – equipment sales, spare parts sales and the provision of services and license revenue. In accordance with Staff Accounting Bulletin 104 issued by the staff of the Securities and Exchange Commission we recognize revenue when all the following criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services rendered, the sales price is fixed or determinable and collectivity is reasonably assured. For transactions that consist of multiple deliverables we allocate revenue to each of the deliverables based upon relative fair values and apply the revenue recognition criteria above to each element. Generally, we recognize revenue on shipment, as the equipment is pre-tested in the factory prior to shipment and our terms of business are FOB factory. For new customers, or new products, revenue is recognized on shipment only if the customer attends and approves the pre-shipment testing procedures and we, and the customer, are satisfied that the performance of the equipment, once installed and operated, will meet the customer-defined specifications. Generally, even with new customers we recognize revenue on shipment because the customer attends and approves the pre-shipment testing. The amount of revenue recorded is reduced by the amount of any customer retention (typically between 10% and 20%), which is not payable by the customer until installation is completed and final customer acceptance is achieved.

The amount of revenue related to system shipments and customer retentions not recognized at March 31, 2005 was $4.2 million compared to $1.9 million at December 31, 2004.

Equipment shipped as demonstration or evaluation units are recognized as revenue on transfer of title and either final acceptance or satisfactory completion of testing which demonstrates that the equipment meets all of the customer defined specifications. Equipment on evaluation at March 31, 2005 totaled $4.0 million as compared to $0.6 million at December 31, 2004.

Revenue related to spare parts is recognized on shipment. Revenue related to service contracts is recognized ratably over the duration of the contracts.

Where a technology has been sold, revenue has been recognized on receipt of royalty payments. Where a technology has been licensed and delivered, to the extent that royalty is irrevocable it is recognized as revenue.

During fiscal 2003 we entered into a contract to develop a piece of equipment for a customer and we determined that the revenue associated with this transaction should be accounted for in accordance with SOP 81-1 – ‘Accounting for the performance of Construction-Type and Certain Production-type Contracts’. The developed equipment was shipped to the customer in fiscal 2003, however significant development work was required during fiscal 2004 and no revenue was recognized with respect to this project in fiscal 2003. The full value of the contract was deferred and the full value of the contract was recognized in fiscal 2004 following establishment of criteria to estimate the percentage of completion. The contract was completed in fiscal 2004.

11

Foreign Currency Translation

Most of our operations are located within the United Kingdom and most of our costs are incurred in British pounds. However, our system sales are generally in US dollars and, to a lesser extent, in euro and we report in US dollars. As a result, fluctuations in the exchange rate between the US dollar and the British pound have a significant effect on our reported earnings and net asset position. We have determined that the functional currency for all UK operations is the British pound and as a result our actual expenses expressed in US dollars will fluctuate with changes in foreign currency exchange rates and result in currency gains and losses, which are charged to net income. Changes in the value of non-US net assets as a result of these movements of foreign currency exchange rates are treated as changes to the cumulative translation adjustment on the balance sheet. We also have significant intercompany loans between the United Kingdom operating subsidiary and the parent, which are determined as being short-term in nature. This determination results in exchange gains and losses associated with these loans being accounted for in the statement of operations.

Inventory Valuation

Inventories are stated at the lower of cost or net realizable value, using standard costs that approximate to actual cost. We maintain a perpetual inventory system and continuously record the quantity on hand and standard cost of each product including purchased components, sub assemblies and finished goods. We maintain the integrity of the perpetual inventory through a cycle stock count program.

Our standard costs are re-assessed at least annually and generally reflect the most recent purchase cost and currently achievable assembly and test labor and overhead rates. We estimate our labor and overhead rates based upon average utilization rates and treat as a period cost abnormal absorption variances, which arise due to low or high production volumes.

We also make provision for slow-moving and obsolete inventory and evaluate their adequacy on a quarterly basis. For our work in process and finished goods inventory, which generally consist of specific systems or modules, we compare the inventory on hand to current sales and market forecasts and other information that indicates the ability to identify a purchaser for such equipment. We apply a formula approach to reserves against raw materials and spares inventory based upon 12-months historic usage, applying different criteria to components that are required for current products, non-current products and spares.

A major component of the estimate of inventory reserves is our forecast of future customer demand, technological and/or market obsolescence, and general semiconductor market conditions. If future customer demand or market conditions are less favorable than our projections then additional inventory write-downs may be required, and these would be reflected in cost of sales in the period the reserves were adjusted.

Installation and Warranty

Our contracts cover on-site installation services and provide for a warranty of the machine. Our standard warranty period varies from 12 to 24 months, depending on a number of factors including the specific equipment purchased.

We account for the estimated warranty cost as a charge to cost of sales at the time of shipment. The warranty reserve is based upon historic product performance and is based on a rolling 12-month average of the historic cost per machine per warranty month outstanding. We also recalculate the estimated warranty cost for all remaining systems still under warranty using the most recent historic average and the difference is included as a component of cost of sales. We do not maintain any general reserves for warranty obligations. Actual warranty costs in the future may vary from historic costs, which could result in adjustments to our warranty reserves in future periods that are more volatile than in recent years.

12

RESULTS OF OPERATIONS

The following table sets forth certain operating data as a percentage of total revenue for the periods indicated:

	Three Months Ended
	March 31, 2005		March 31, 2004
			(As restated)
Product revenues	74.2	%	99.4	%
License revenue	25.8	%	0.6	%
Total revenue	100.0	%	100.0	%
Cost of goods sold	50.2	%	85.3	%
Gross margin	49.8	%	14.7	%
Operating expenses:
Research and development	29.2	%	42.7	%
Selling, general and administrative	47.3	%	66.5	%
Total operating expenses	76.5	%	109.2	%
Loss from operations	(26.7	)%	(94.5	)%
Foreign currency (losses) gains	(3.3	)%	9.2	%
Interest income, net	0.3	%	1.0	%
Loss before income tax charge	(29.7	)%	(84.3	)%
Income tax charge	(0.7	)%	(1.0	)%
Net loss	(30.4	)%	(85.3	)%

Product Revenues

Product revenues for the three months ended March 31, 2005 decreased 14% to $5.8 million compared to $6.7 million for the three months ended March 31, 2004. Shipments for the three months ended March 31, 2005 were $12.1 million compared to $4.3 million in the first quarter of the prior year.

Revenue from outside of the United States accounted for approximately 89% and 85% of total product revenue in the three-month periods ended March 31, 2005 and March 31, 2004, respectively. We expect that sales outside of the United States will continue to represent a significant percentage of our product sales through 2005.

Our sales by product are as follows:

	Three Months Ended
	March 31 2005		March 31 2004
PVD	35	%	35	%
CVD	1	%	8	%
Etch	27	%	15	%
Spares and service	37	%	42	%
Total	100	%	100	%

Due to the large unit price associated with our systems we anticipate that our product sales will continue to be represented by a small number of unit sales in any quarter. The quantity, product, customer and geographical mix shipped in any particular quarter can fluctuate significantly and are therefore not indicative of a trend. Further, our customers are demanding greater flexibility and shorter delivery times, which increase the fluctuations that may occur in each quarter.

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License revenues

License revenues relate to an exclusive license of power supply technology and a non-exclusive license fee of $2 million, in connection with a joint development agreement entered into with Aviza Technology Inc. on March 14, 2005. License revenues for the three-month period ended March 31, 2005 were 26% of total revenue.

Gross Margin

The gross margin on product sales for the three-month period ended March 31, 2005 was 32% as compared to 14% for the three-month period ended March 31, 2004. The improved gross margin is attributable to improved efficiency within manufacturing, increased utilization and lower costs as a result of our cost reduction programs completed during fiscal 2004. As a result of the license fee the overall gross margin for the three-month period ended March 31, 2005 was 50%.

Research and development expenses

Research and development expenses for the three months ended March 31, 2005 were $2.3 million or 29% of total revenues compared with $2.9 million or 43% of total revenues for the three months ended March 31, 2004. The decrease in research and development expenses in the first quarter of 2005 reflects reduced headcount and other expenses. However, we continue to invest significant resources into technology development. The major focus of our research and development efforts will be the development of new processes in further advancing our proprietary PVD, CVD and etch technologies, especially the development of novel process solutions for the Flowfill and Orion product lines at technology modes of 90nm and below. The decrease as a percentage of total revenue is due to the increase in license revenue without associated research and development expense.

We have received an offer of a grant from the UK government to develop Broad Ion Beam Deposition technology in collaboration with other parties for Magnetic Random Access Memory applications. The grant will reimburse 50% of the total project costs to a maximum of $3.1 million. The project is contingent upon all parties accepting the offer and as at March 31, 2005 no costs had been incurred and none of the funding had been received. Although we have been informed that one party in the original consortium is unable to continue the program, we have been informed that it will be possible to substitute such party. We have identified an alternative and presently await a formal letter of support from them. The expenditure and funding are expected to commence in fiscal 2005 and would be expended/received over the 18-month period of the project.

We have also accepted an offer of a grant from the Welsh Development Agency to develop a process to fabricate microfluidic substrates for the production of a single stage emulsion for R&D use by pharmaceutical and biotechnology companies. This grant will reimburse 50% of the total project costs to a maximum of $300,000. The project start date was March 8, 2005, and the project is expected to complete by May 2006. There were no costs or receipts associated with this project during the quarter.

Selling, general and administrative expenses

Selling, general and administrative expenses for the three months ended March 31, 2005 were $3.7 million, or 47% of total revenues, compared to $4.5 million, or 66% of total revenues in the three months ended March 31, 2004. Selling, general and administrative expenses for the first quarter of 2005 include legal, accounting and due diligence costs of $0.6 million expended in respect of the planned merger with Aviza Technology Inc. Selling, general and administrative expenses for the first quarter 2004 include one-time items of employee redundancy, other reorganization costs and a property tax credit totaling $0.5 million.

Results of operations

We incurred a loss from operations of $2.1 million in the three months ended March 31, 2005 compared with a loss from operations of $6.4 million in the three months ended March 31, 2004. The combination of higher gross margins reduced operating costs and license revenue receipts have contributed to a significant reduction in the loss from operations as compared to the first quarter 2004.

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Interest income (expense) net

Net interest income was $26,000 for the three months ended March 31, 2005 compared to $66,000 for the three months ended March 2004. Lower cash balances and reduced interest expense on lower borrowings, which are offset against interest income, caused the reduction in interest income.

Income taxes

For the three months ended March 31, 2005, we recorded a tax charge of $56,000 compared with a tax charge of $65,000 for the three months ended March 31, 2004. We expect to report a small tax charge for the fiscal year ending December 31, 2005 which will consist solely of foreign and minimum state taxes (primarily Delaware) for which no carry forward net operating losses are available. In estimating the tax rate for the three months ended March 31, 2005, we have not provided any benefit for the deferred tax asset arising from operating losses generated that can only be offset against future profits.

NEW ACCOUNTING PRONOUNCEMENTS

As permitted by Statement 123, we currently account for share-based payments to employees using Opinion 25’s intrinsic value method and, as such, generally recognize no compensation cost for employee stock options. Accordingly, the adoption of Statement 123(R)’s fair market value method will have a significant impact on our result of operations, although it will have no impact on our overall financial position. The impact of adoption of Statement 123(R) cannot be predicted at this time because it will depend on levels of share-based payments granted in the future. However, had we adopted Statement 123(R) in prior periods, the impact of that standard would have approximated the impact of Statement 123 as described in the disclosure of pro forma net income and earnings per share in Note H to our consolidated financial statements. Statement 123(R) also requires the benefit of tax deductions in excess of recognized compensation cost to be reported as a financing cash flow, rather than as an operating cash flow as required under current literature. This requirement is not expected to have a material effect on our financial condition or results of operations.

In November 2004, the FASB issued SFAS No. 151, “Inventory Costs an amendment of ARB No. 43, Chapter 4” (SFAS No. 151). SFAS No. 151 amends the guidance in ARB No. 43, Chapter 4, “Inventory Pricing,” to clarify the accounting for abnormal amounts of idle facility expenses, handling costs and wasted material (spoilage). Among other provisions, SFAS 151 requires that such items be recognized as current-period charges, regardless of whether they meet the criterion of “so abnormal” as stated in ARB No. 43. SFAS No. 151 is effective for fiscal years beginning after June 15, 2005. We do not expect that adoption of SFAS No. 151 will have a material effect on our consolidated financial position, consolidated results of operations, or liquidity.

LIQUIDITY AND CAPITAL RESOURCES

At March 31, 2005, we had $18.5 million in cash and cash equivalents, compared to $21.2 million at December 31, 2004. Cash and cash equivalents excluding bank borrowings were $9.0 million at March 31, 2005 compared to $11.6 million at December 31, 2004.

In July 2003, we entered into a two-year revolving credit facility for 5 million British pounds ($9.5 million at the March 31, 2005 exchange rate) (the “2003 facility”). Interest on the 2003 facility will be incurred at the London Interbank rate (LIBOR) plus 1.75% for borrowings in British pounds and at the Bank’s short-term offered rate plus 1% for foreign currency. At the end of the first quarter of 2005 we had drawn down all of this facility.

The 2003 facility, as subsequently amended, includes financial covenants that require we maintain a consolidated net worth of not less than $40 million, and that our interest expense on the loan net of any interest receivable from the same British bank does not exceed 70,000 British pounds in any one fiscal quarter. At March 31, 2005, our consolidated net worth was $37.9 million, which put us in breach of the minimum shareholders’ equity covenant in the credit facility. The bank has the ability, if it chooses, to require us to repay the $9.5 million, which we have drawn down on the facility. In any event, the facility expires and all amounts become due and payable on June 30, 2005. We are currently undertaking discussions with the bank to obtain a waiver against the net worth covenant and an extension of the facility. There can be no assurance that the bank will grant a waiver or extension.

Our cash and cash equivalents balances, net of amounts borrowed under the 2003 facility, was $9.0 million at March 31, 2005 and represents our primary source of liquidity. Our cash used in operating activities was $3.2 million in the quarter ended March 31, 2005. As a result, if we do not continue to increase revenue, reduce operating costs and return to profitability we may use all, or a substantial part of our cash balance to fund our current obligations and our operations.

The amount of funding required by operations in the next twelve months will depend on numerous factors including market conditions within the semiconductor industry, general economic conditions, our ability to increase our revenue or reduce our expenditures and our ability to reduce our working capital requirements in areas such as inventory and accounts receivable. However, management believes, based upon our current forecast for revenues operating expenses, cash flows and other financial metrics that the resources available at March 31, 2005 are sufficient to fund operations for at least the next twelve months.

If anticipated revenues do not meet our expectations we would continue to seek to scale back our operations to lower the use of cash. We also anticipate that we would seek to raise additional debt or equity funding during the next twelve months and, as noted above, we are seeking an extension or replacement to the current line of credit.

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RISK FACTORS

There are numerous risks associated with the pending merger with Aviza Technology, Inc.

On March 14, 2005, we announced that we had entered into a definitive agreement to combine with Aviza Technology, Inc. to form a new company. The transaction is subject to a number of risks including risks related to the following:

• unanticipated expenses related to the merger transaction;

• the potential disruption of our ongoing business and distraction of our management;

• potential loss of key employees and employee productivity;

• adverse effects on existing business relationships with customers and customer prospects;

• potential revenue decline as a result of customer and potential customer uncertainty;

• the impairment of relationships with employees, customers, distributors, strategic partners and suppliers as a result of integration of management and other key personnel; and

• the failure to realize the expected benefits of combining with Aviza Technology, Inc.

In addition, if the merger is not consummated for any reason, we may be subject to a number of risks, including:

• the market price of our common stock could decline following an announcement that the merger has been abandoned to the extent that the current market price reflects a market assumption that the merger will be completed;

• the effect of incurring substantial costs related to the merger, such as legal, accounting and financial advisor fees, which will be required to be paid even if the merger is not consummated;

• our ability to retain key employees may be adversely affected;

• our relationships with customers may be adversely affected; and

• depending upon the reason for termination of the merger, the possible requirement that we pay a substantial termination fee to Aviza Technology, Inc.

In connection with the proposed merger, New Athletics, Inc will file a proxy statement/prospectus with the Securities and Exchange Commission. The proxy statement/prospectus will contain important information about the proposed merger, risks relating to the merger, and related matters, we urge all of our stockholders to read the proxy statement/prospectus carefully when it becomes available.

We have experienced losses over the last few years and we may not be able to achieve profitability and may need to raise additional capital to support our operations.

We have experienced losses of $2.4 million, during the three months ended March 31, 2005 and $13.7 million and $25.0 million for the years ended December 31, 2004 and 2003, respectively. We will need to increase sales and/or reduce costs to return to profitability. However, we may never generate sufficient revenues to achieve profitability. Even if we do achieve profitability, we may not sustain or increase profitability on a quarterly or annual basis in the future.

As of March 31, 2005, we had cash and cash equivalents of approximately $18.5 million and short-term debt of $9.5 million. The short-term debt comprises 5 million British pounds ($9.5 million at the March 31, 2005 exchange rate) outstanding under our credit facility that we may be required to repay if we breach the consolidated net worth covenant in the facility. A breach of this covenant has occurred as at March 31, 2005, and the bank has the option to require repayment of all amounts drawn down on the facility if it chooses. Discussions with the bank are ongoing on this issue. There can be no assurance that a replacement facility can be obtained or that the bank will not demand immediate repayment. We may need to raise additional capital in the next twelve months from the sale of equity. In addition, regardless of whether such financing is absolutely necessary, we may seek additional debt or equity

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financing in the next twelve months in order to strengthen our cash position. We may not be able to obtain additional financing on acceptable terms, or at all. If we issue additional equity or convertible debt securities to raise funds, the ownership percentage of our existing stockholders would be reduced and they may experience significant dilution. New investors may demand rights, preferences or privileges that differ from, or are senior to, those of existing holders of our common stock, including warrants in addition to the securities purchased and protection against future dilutive transactions. If we are unable to achieve positive cash flows or raise additional capital, we may be forced to implement further expense reduction measures, including, but not limited to, the sale of assets, the consolidation of operations, workforce reductions, and/or the delay, cancellation or reduction of certain product development, marketing or other operational programs.

We may not achieve profitability in fiscal 2005 and may not achieve the sales necessary to avoid further expense reduction measures in the future. Such expense reduction measures could materially adversely affect our results of operations and prospects and may not be successful in preserving sufficient cash to continue operations.

The semiconductor industry is highly cyclical and unpredictable.

Our business depends upon the capital expenditures of semiconductor manufacturers, which in turn depend on the current anticipated market demand for integrated circuits. The semiconductor industry has historically been cyclical due to sudden changes in demand for semiconductors and manufacturing capacity using the latest technology. These changes in demand have affected the timing and amounts of customers’ capital equipment purchases and investments in technology, and continue to affect our orders, net sales, gross margin and results of operations.

During periods of decreasing demand for integrated circuit manufacturing equipment, we must be able to appropriately align our cost structure with prevailing market conditions and effectively motivate and retain key employees. Conversely, during periods of increasing demand, we must have sufficient manufacturing capacity and inventory to meet customer demand, and must be able to attract, retain and motivate a sufficient number of qualified individuals. If we are not able to timely adjust our cost structure with business conditions and/or to effectively manage our resources and production capacity during changes in demand, our business, financial condition or results of operations may be materially and adversely affected.

We are exposed to risks associated with a highly concentrated customer base.

Our orders and revenue are from a relatively small number of customers, which we expect to continue. In the first quarter of 2005, three customers exceeded 10% of product revenues. This may lead customers to demand from us less favorable pricing and other terms. In addition, sales to any single customer may vary significantly from quarter to quarter. If current customers delay, cancel or do not place orders, we may not be able to replace these orders with new orders in the corresponding period, and our results of operations will suffer. As our products are configured to customer specifications, changing, rescheduling or canceling orders may result in significant and often non-recoverable costs. The resulting fluctuations in the amount of and terms of orders could have a material adverse effect on our business, financial condition and results of operations.

We will not be able to compete effectively if we fail to address the technology needs of our customers.

We operate in a highly competitive environment, and our future success is heavily dependent on effective development, commercialization and customer acceptance of new products compared to our competitors. In addition, our success is dependent upon our ability to timely and cost-effectively:

• develop and market new products and technologies;

• improve existing products and technologies;

• expand into or develop equipment solutions for new markets for integrated circuit products;

• achieve market acceptance and accurately forecast demand for our products and technologies;

• achieve cost efficiencies across our product offerings;

• qualify new or improved products for volume manufacturing with our customers; and

• lower our customers’ cost of ownership.

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The development, introduction and support of new or improved products and technologies, including those which enable smaller feature sizes, new materials and the utilization of 300mm wafers becomes increasingly expensive and unpredictable. For example, the adoption of our ORION^® technology for ultra low k deposition has been delayed as a result of integration issues at the potential customers. Until such integration issues are resolved, our ability to obtain commercial sales of our ORION^® technology is limited and there can be no assurance that these integration issues will be resolved. We also need to continue to develop technology for such customer needs as power semiconductors, SiP/Mems, BAW, Flowfill, and other applications and there can be no assurance that such developments will be consistent with the needs of these customers.

We may not be able to accurately forecast or respond to the technological trends in the semiconductor industry or respond to specific product announcements by our competitors. Our competitors may be developing technologies and products that are more effective or that achieve more widespread acceptance. In addition, we may incur substantial costs to ensure the functionality and reliability of our current and future products. If our new developed products are unreliable or do not meet our customers’ expectations, then reduced orders, higher manufacturing costs, delays in collecting accounts receivable or additional service and warranty expense could result. Our customers may purchase equipment for their new products but experience delays and technical and manufacturing difficulties in their introductions or transition to volume production using our systems causing significant delays between the sale of an initial tool into our customers development facility and limit the potential for follow on sales for manufacturing. Any of these events could negatively affect our ability to generate the return we expect to achieve on our investments in these new products.

Integrated circuit manufacturers have been slow to adopt the use of new materials and if we fail to continue to develop these solutions to achieve all the specifications required by device manufacturers and/or the device manufacturers fail to successfully integrate these technologies with their other processes, or our competitors develop competing solutions, then our ability to grow our revenues from these products would be negatively affected.

Our operating results could be negatively affected by currency fluctuations.

We are based in the United Kingdom, and most of our operating expenses are incurred in British pounds. Our revenues, however, are generally denominated in US dollars, and to a lesser extent in euro, and we report our financial results in US dollars. Accordingly, if the British pound increases in value against the US dollar, our expenses as a percentage of revenues will increase and gross margins and net income will be negatively affected.

The semiconductor industry is global and is expanding within the Asian region. If we are unable to penetrate this market our ability to grow our revenues will be restricted.

The percentage of worldwide semiconductor production that is based in the Asian region is growing, particularly within China. Our business has traditionally been strongest with the European semiconductor manufacturers and we have only a small installed base and limited brand recognition in Asia. It will be necessary for us to penetrate the region by attracting new customers and expanding relationships in Asia to grow our business. While we have appointed a new sales representative in this region and hired a small number of employees, there is no assurance that we will be able to penetrate these geographic markets, which are subject to growth rates that are higher than worldwide growth rates. Failure to penetrate these markets may harm our competitive position and adversely affect our future business prospects

Our competitors have greater financial resources and greater name recognition than we do and therefore may compete more successfully.

We face competition or potential competition from many companies with greater resources than ours. If we are unable to compete effectively with these companies, our market share may decline and our business could be harmed.

Virtually all of our primary competitors are substantially larger companies and some of them have broader product lines than ours. They have well-established reputations in the markets in which we compete, greater experience with high volume manufacturing, broader name recognition, substantially larger customer bases, and substantially greater financial, technical, manufacturing and marketing resources than we do. We also face potential competition from new entrants, including established manufacturers in other segments of the semiconductor capital equipment market who may decide to diversify and develop and market products that compete with our current offerings.

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Semiconductor manufacturers are loyal to their current semiconductor equipment supplier, which may make it difficult for us to obtain new customers.

Because semiconductor manufacturers must make a substantial investment to install and integrate capital equipment into a semiconductor fabrication facility, these manufacturers will tend to choose semiconductor equipment manufacturers based on established relationships, product compatibility and proven system performance.

Once a semiconductor manufacturer selects a particular vendor’s capital equipment, the manufacturer generally relies for a significant period of time upon equipment from this vendor of choice for the specific production line application. To do otherwise creates risk for the manufacturer because the manufacture of a semiconductor requires many process steps and a fabrication facility will contain many different types of machines that must work cohesively to produce products that meet the customers’ specifications. If any piece of equipment fails to perform as expected, the customer could incur significant costs related to defective products, production line downtime, or low production yields.

Since most new fabrication facilities are similar to existing ones, semiconductor manufacturers tend to continue using equipment that has a proven track record. Based on our experience with major customers such as Infineon, we have observed that once a particular piece of equipment is selected from a vendor, the customer is likely to continue purchasing that same piece of equipment from the vendor for similar applications in the future. Our customer list, though limited, has increased in fiscal 2004. Yet our broadening market share remains at risk due to choices made by customers that continue to be influenced by pre-existing installed bases by competing vendors. Consequently, our penetration of new customers and our ability to get additional orders may be limited.

A semiconductor manufacturer frequently will attempt to consolidate its other capital equipment requirements with the same vendor. Accordingly, we may face narrow windows of opportunity to be selected as the “vendor of choice” by potential new customers. It may be difficult for us to sell to a particular customer for a significant period of time once that customer selects a competitor’s product, and we may not be successful in obtaining broader acceptance of our systems and technology. If we are not able to achieve broader market acceptance of our systems and technology, we may be unable to grow our business and our operating results and financial condition will be harmed.

Our products generally have long sales cycles and implementation periods, which increase our costs of obtaining orders and reduce the predictability of our earnings.

Our products are technologically complex. Prospective customers generally must commit significant resources to test and evaluate our products and to install and integrate them into larger systems. In addition, customers often require a significant number of product presentations and demonstrations, in some instances evaluating equipment on site, before reaching a sufficient level of confidence in the product’s performance and compatibility with their requirements to place an order. As a result, our sales process is often subject to delays associated with lengthy approval processes that typically accompany the design and testing of new products. The sales cycles of our products often last for many months or even years. Longer sales cycles require us to invest significant resources in attempting to make sales and delay the generation of revenue. In addition, we may incur significant costs in supporting evaluation equipment at our customers’ facilities.

Long sales cycles also subject us to other risks, including customers’ budgetary constraints, internal acceptance reviews and cancellations. In addition, orders expected in one quarter could shift to another because of the timing of customers’ purchase decisions. The time required for our customers to incorporate our products into their manufacturing processes can vary significantly with the needs of our customers and generally exceeds several months, which further complicates our planning processes and reduces the predictability of our operating results.

Customers are also demanding shorter delivery times from the time of placing a purchase order. We therefore are required to negotiate with our suppliers shorter lead times for the materials required and we may need to purchase inventory and to commence building for a customer prior to receipt of a confirmed purchase order. It is not possible to fully mitigate this risk within the supply chain. In the event a purchase order is not received from a customer where we had commenced manufacturing, then higher inventory levels would be incurred and potential inventory write-offs would also be incurred if an alternative customer is not identified to purchase that system

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We depend upon sole suppliers for certain key components.

We depend on a number of sole suppliers for key components used in the manufacture of our products. If we are unable to obtain timely delivery of sufficient quantities of these components, we would be unable to manufacture our products to meet customer demand, unless we are able to locate replacement components. Most significantly, our cluster tools are designed around an automation module supplied by Brooks Automation. Due to the high cost of these module’s we keep very few in inventory. If Brooks Automation fails to deliver the component on a timely basis, delivery of our cluster tools will be delayed and sales may be lost. If Brooks Automation is unable to deliver any such modules for a prolonged period of time, we will have to redesign our cluster tools so that we may utilize other wafer transport systems. There can be no assurance that we will be able to do so, or that customers will adopt the redesigned systems.

Our final assembly and testing is concentrated in one facility.

Our final assembly and testing activity is concentrated in our facility in Newport, United Kingdom. We have no alternative facilities to allow for continued production if we are required to cease production in our facility, as a result of a fire, natural disaster or otherwise. In such event, we will be unable to produce any products until the facility is replaced. Any such interruption in our manufacturing schedule could cause us to lose sales and customers, which could significantly harm our business

If we are unable to hire and retain a sufficient number of qualified personnel, our ability to manage growth will be negatively affected.

Our business and future operating results depend in part upon our ability to attract and retain qualified management, technical, sales and support personnel for our operations on a worldwide basis. Competition for qualified personnel is intense, and we cannot guarantee that we will be able to continue to attract and retain qualified personnel. Our operations could be negatively affected if we lose key executives or employees or are unable to attract and retain skilled executives and employees as needed.

Our ability to compete could be jeopardized if we are unable to protect our intellectual property rights from challenges by third parties.

Our success and ability to compete depend in large part upon protecting our proprietary technology. We rely on a combination of patent, trade secret, copyright and trademark laws, non-disclosure and other contractual agreements and technical measures to protect our proprietary rights.

There can be no assurance that patents will be issued on our pending patent applications or that competitors will not be able to ascertain legitimately proprietary information embedded in our products that is not covered by patent or copyright. In such case, we may be precluded from preventing the competitor from making use of such information.

In addition, should we wish to assert our patent rights against a particular competitor’s product, there can be no assurance that any claim in any of our patents will be sufficiently broad nor, if sufficiently broad, any assurance that our patent will not be challenged, invalidated or circumvented, or that we will have sufficient resources to prosecute our rights. Failure to protect our intellectual property could have an adverse effect on our business.

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Claims or litigation regarding intellectual property rights could seriously harm our business or require us to incur significant costs.

In recent years, there has been significant litigation in the United States in the semiconductor equipment industry involving patents and other intellectual property rights. Infringement claims may be asserted against us in the future and, if such claims are made, we may not be able to defend against such claims successfully or, if necessary, obtain licenses on reasonable terms. Any claim that our products infringe proprietary rights of others would force us to defend ourselves and possibly our customers against the alleged infringement. These claims and any resulting lawsuit, if successful, could subject us to significant liability for damages and invalidation of our proprietary rights. These lawsuits, regardless of their outcome, would likely be time-consuming and expensive to resolve and would divert management’s time and attention. Any potential intellectual property litigation could force us to do one or more of the following:

• lose or forfeit our proprietary rights;

• stop manufacturing or selling our products that incorporate the challenged intellectual property;

• obtain from the owner of the infringed intellectual property right a license to sell or use the relevant technology, which license may not be available on reasonable terms or at all and may involve significant royalty payments;

• pay damages, including treble damages and attorney’s fees in some circumstances; or

• re-design those products that use the challenged intellectual property.

• If we are forced to take any of the foregoing actions, our business could be severely harmed.

Our operations are subject to health and safety and environmental laws that may expose us to liabilities for noncompliance.

We are subject to a variety of governmental regulations relating to the use, storage, discharge, handling, manufacture and disposal of all materials present at, or our output from, our facilities, including the toxic or other hazardous chemical by-products of our manufacturing processes. Environmental claims against us, or our failure to comply with any present or future regulations could result in, significant costs to remediate, the assessment of damages or imposition of fines against up; the suspension of production of our products; or the cessation of our operations.

New regulations could require us to purchase costly equipment or to incur other significant expenses. Our failure to control the use or adequately restrict the discharge of hazardous substances could subject us to future liabilities, which could negatively affect our operating results and financial condition.

Any acquisitions we may make could disrupt our business and severely harm our financial condition.

We may consider it necessary to invest in complementary products, companies or technologies, such investments involve numerous risks, including but not limited to: (1) diversion of management’s attention from other operational matters; (2) inability to complete acquisitions as anticipated or at all; (3) inability to realize synergies expected to result from an acquisition; (4) failure to commercialize purchased technologies; (5) ineffectiveness of an acquired company’s internal controls; (6) impairment of acquired intangible assets as a result of technological advancements or worse-than-expected performance of the acquired company or its product offerings; (7) unknown and/or undisclosed commitments or liabilities; (8) failure to integrate and retain key employees; and (9) ineffective integration of operations. Mergers and acquisitions are inherently subject to significant risks, and the ability to effectively manage these risks could materially and adversely affect our business, financial condition and results of operations.

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Changes in accounting rules may adversely affect our financial results.

We prepare our financial statements in conformity with Generally Accepted Accounting Principles (GAAP) of the United States of America. These principles are subject to interpretation by the Securities and Exchange Commission (the “SEC”) and the Financial Accounting Standards Board (FASB) A change in these policies can have a significant effect on our reported results and may even retroactively affect previously reported transactions. In particular, changes to FASB guidelines relating to accounting for stock-based compensation will likely increase our compensation expense, could make our net result less predictable in any given reporting period and could change the way we compensate our employees or cause other changes in the way we conduct out business.

You may have difficulty protecting your rights as a stockholder and in enforcing civil liabilities because many of our executive officers and the majority of the members of our board of directors and the majority of our assets are located outside the United States.

Our principal assets and manufacturing plants are located in the United Kingdom. In addition, most of the members of our board of directors and our executive officers are residents of jurisdictions other than the United States. As a result, it may be difficult for stockholders to serve process within the United States upon members of our board of directors and our executive officers, or to enforce against us or members of our board of directors or our executive officers judgments of the U.S. courts, to enforce outside the United States judgments obtained against members of our board of directors or our executive officers in U.S. courts, or to enforce in U.S. courts judgments obtained against members of our board of directors or our executive officers in courts in jurisdictions outside the United States, in any action, including actions that derive from the civil liability provisions of the U.S. securities laws. In addition, it may be difficult for our stockholders to enforce, in original actions brought in courts in jurisdictions located outside the United States, liabilities that derive from U.S. securities laws.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

The following discussion and analysis about market risk disclosures may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Such statements include declarations regarding our intent, belief or current expectations and involve risks and uncertainties. Actual results could differ materially from those projected in the forward-looking statements.

Our earnings and cash flow are subject to fluctuations in foreign currency exchange rates. Significant factors affecting this risk include our manufacturing and administrative cost base, which is predominately in British pounds, and product sales outside the United States, which may be expressed in currencies other than the United States dollar. We constantly monitor currency exchange rates and match currency availability and requirements whenever possible. We may from time to time enter into forward foreign exchange transactions in order to minimize risk from firm future positions arising from trading. As of March 31, 2005 and December 31, 2004 we did not have any open forward currency transactions.

Based upon budgeted income and expenditures, a hypothetical increase of 10% in the value of the British pound against all other currencies in the first quarter of 2005 would have no material effect on revenues, which are primarily expressed in United States dollars but would increase operating costs and reduce cash flow by approximately $0.9 million. The same increase in the value of the British pound would increase the value of our net assets expressed in United States dollars by approximately $3.7 million. The effect of the hypothetical change in exchange rates ignores the effect this movement may have on other variables including competitive risk. If it were possible to quantify this impact, the results could be significantly different from the sensitivity effects shown above. In addition, it is unlikely that all currencies would uniformly strengthen or weaken relative to the British pound. In reality, some currencies may weaken while others may strengthen.

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ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Our internal control system is designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation and fair presentation of published financial statements.

An evaluation was performed under the supervision and with the participation of our management team, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our management, including the CEO and CFO, initially concluded that our disclosure controls and procedures were effective as of March 31, 2005.

In May 2005, we re-evaluated controls over the selection, application and monitoring of our accounting policies with respect to (i) the classification of accounts receivable and deferred revenues on contracts with a portion of the contract price that is withheld until final acceptance, (ii) the timing of recognition of costs on those contracts and (iii) the allocation of facilities cost, and deemed they were not effective. Accordingly, we decided to restate certain of our previously issued financial statements to reflect the corrections (see our Form 10-K/A for the fiscal year ended December 31, 2004, including notes 13 and 14 to our consolidated financial statements contained therein, for more regarding our restatement).

Auditing Standard Number 2 issued by the Public Company Accounting Oversight Board, or PCAOB, indicates that a restatement of previously issued financial statements is a strong indicator that a material weakness in internal control over financial reporting exists.” Based on that evaluation, Trikon’s management has revisited its initial evaluation and has now concluded that our disclosure controls and procedures were not effective as of March 31, 2005.

Changes in Internal Controls

In order to remediate our internal controls over financial reporting, subsequent to March 31, 2005, we sought additional advice and implemented additional review procedures over the selection application and monitoring of appropriate accounting policies to ensure overall compliance with GAAP. In order to reinforce our existing control procedures and to ensure that our policies continue to conform to GAAP and SEC pronouncements, among other things, we have subscribed to certain relevant informational databases designed expressly for the purpose of monitoring changes in GAAP and reinforced our existing procedures to discuss these changes with our audit committee, independent registered public accounting firm and other advisors as deemed necessary.

There have been no changes in our internal control over financial financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act) that occurred during our last fiscal quarter that has materially affected or is reasonably likely to materially affect our financial reporting.

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Trikon Technologies, Inc.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On March 10, 2004 Dr. Jihad Kiwan departed the Company as Director and Chief Executive Officer. On March 29, 2004 and April 2, 2004 we received letters from a United Kingdom law firm and from a French law firm, respectively, on behalf of Dr. Kiwan, detailing certain monetary claims with respect to severance amounts due to Dr. Kiwan with respect to his employment with Trikon. On April 28, 2004 Dr. Kiwan filed a lawsuit in France. We are in the process of vigorously defending against this claim.

From time to time we become involved in ordinary, routine or regulatory legal proceedings incidental to our business.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

On February 9, 2005, our board of directors resolved to amend the outstanding option agreements held by Christopher Dobson, Nigel Wheeler and John Macneil to provide for full acceleration of options with a per share exercise price below $6.00 upon the completion of the proposed merger transaction with Aviza Technology, Inc. The board granted such acceleration to Dr. Macneil as an incentive for him to remain with Trikon as its Chief Executive Officer through the completion of the merger transaction. The acceleration of options for Messrs. Dobson and Wheeler was prompted by, among other considerations, a recognition by the board that all other non-employee directors, who were granted options only under the 1998 Directors Stock Option Plan, which provides for full option vesting upon a change of control, would have all of their options vest in full as a result of the merger transaction, whereas Messrs. Dobson and Wheeler, who held options granted outside of the 1998 Directors Stock Option Plan, would not otherwise have had all of their options vest as a result of the proposed merger transaction. In addition, absent such vesting, such unvested options would terminate since Messrs. Dobson and Wheeler are not expected to remain on the Board of Trikon or New Athletics, Inc. in the event the merger is consummated.

ITEM 6. EXHIBITS

(a) The following exhibits are included herein:

2.1	Agreement and Plan of Merger By and Among Trikon Technologies, Inc., Aviza Technology, Inc., New Athletics, Inc., Baseball Acquisition Corp. I, and Baseball Acquisition Corp. II , dated March 14, 2005 (Previously filed as an exhibit to the Company’s Current Report on Form 8-K on March 15, 2005, and incorporated by reference herein)
10.1*	Joint Development Agreement dated March 14, 2005 between the Company and Aviza Technology, Inc.
10.2	Indemnification Agreement between the Company and Martyn Tuffery dated March 31, 2005
10.3	Offer Letter between the Company and Martyn Tuffery dated April 5, 2005
10.4	Compromise Agreement between the Company and William Chappell dated as of March 31, 2005
10.5	Contract for Services between the Company and William Chappell dated as of March 31, 2005
31.1	Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act
31.2	Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act
32.1	Certificate of Chief Executive Officer furnished pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350)
32.2	Certificate of Chief Financial Officer furnished pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350)

* Confidential treatment has been requested with respect to certain portions of this exhibit. This exhibit omits the information subject to such confidentiality request. The omitted portions have been filed separately with the Securities and Exchange Commission.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	TRIKON TECHNOLOGIES, INC.
Date: June 1, 2005	/s/ John Macneil
	John Macneil
	Chief Executive Officer, President
	and Director
	/s/ Martyn J. Tuffery
	Martyn J. Tuffery
	Senior Vice President and Acting Chief Financial Officer

25

EX-10.1

Exhibit 10.1

EXECUTION COPY – 3/14/05

JOINT DEVELOPMENT AGREEMENT

by and between

TRIKON TECHNOLOGIES, INC.

and

AVIZA TECHNOLOGY, INC.

dated

March 14, 2005

EXECUTION COPY – 3/14/05

TABLE OF CONTENTS

ARTICLE I Definitions and Construction		1
1.1	Definitions	1
1.2	Construction	4
ARTICLE II Development		4
2.1	General	4
2.2	Delivery of Existing Manufacturing Documentation and Software Source Code	4
2.3	Requirements	4
2.4	First Payment Milestones – Delivery of Trikon Transport Module and the Existing Manufacturing Documentation     and Source Code	5
2.5	Delivery of Documented Transport Module Software	5
2.6	Second Payment Milestone – Delivery of Developed Software	5
2.7	Third Payment Milestone – Acceptance of Software	6
2.8	Milestone Dependencies	6
ARTICLE III Project Management		7
3.1	Project Managers	7
3.2	Responsibilities	7
3.3	Appointment	7
3.4	Replacement	7
3.5	Facilities	7
3.6	Development Access	7
ARTICLE IV Post-Development Supply and License		8
4.1	Supply Commitment	8
4.2	Price	8
4.3	Limitation	8
4.4	Manufacturing Documentation and Software Updates	8
ARTICLE V Fees and Payment		9
5.1	Development Fee	9
5.2	License Fee	9
5.3	Royalties	9
5.4	Taxes	9
5.5	Payment Method	10
ARTICLE VI IP Rights and Ownership		10
6.1	General IP Ownership	10
ARTICLE VII IP and Software Licenses		10
7.1	General	10

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7.2	Granted By Trikon	10
7.3	Delivery	11
ARTICLE VIII Confidentiality		11
8.1	Confidential Information	11
8.2	Confidential Information Exclusions	11
8.3	Mandatory Disclosures	11
8.4	Confidentiality Obligation	11
8.5	Confidentiality of Agreement	12
ARTICLE IX Representations and Warranties		12
9.1	Mutual Representations and Warranties	12
9.2	Trikon Representations and Warranties.	12
9.3	Existing Manufacturing Documentation and Software	13
9.4	Disclaimer	13
ARTICLE X Indemnity		13
10.1	Indemnification by Trikon	13
10.2	Remedies	13
10.3	Limitations	14
ARTICLE XI Limitation of Liability		14
11.1	CONSEQUENTIAL DAMAGES	14
11.2	LIMITATION OF LIABILITY	14
ARTICLE XII Governing Law		14
12.1	Governing Law	14
ARTICLE XIII Term and Termination		15
13.1	Term of Agreement	15
13.2	Termination by Aviza	15
13.3	Termination for Cause	15
13.4	Effect of Termination	15
ARTICLE XIV Miscellaneous		15
14.1	Force Majeure	15
14.2	Import and Export	15
14.3	Relationship of Parties	15
14.4	No Third Party Beneficiaries	16
14.5	Notices	16
14.6	Assignment	16
14.7	Waiver and Modification	16
14.8	Severability	16
14.9	Trademarks	16
14.10	Freedom of Action	16
14.11	Entire Agreement	17
14.12	Counterparts	17

EXECUTION COPY – 3/14/05

TABLE OF EXHIBITS

EXHIBIT A	Development Plan
EXHIBIT A-1	Requirements
EXHIBIT A-2	Trikon Milestones and Aviza Dependencies
EXHIBIT A-3	Acceptance Criteria
EXHIBIT B	Software Support Terms
EXHIBIT 4.1	Purchase Terms and Conditions

-i-

EXECUTION COPY – 3/14/05

JOINT DEVELOPMENT AGREEMENT

This Joint Development Agreement (the “Agreement”) is made and entered into as of this 14^th day of March, 2005 (“Effective Date”), by and between Aviza Technology, Inc., a Delaware corporation (“Aviza”), and Trikon Technologies, Inc. a Delaware corporation (“Trikon”). (As used in this Agreement, each of Aviza and Trikon is a “Party” and collectively the “Parties.”)

BACKGROUND

A. Trikon is in the business, among other things, of marketing and selling equipment for deposition and etch of thin films for use in the production of semiconductor devices.

B. Aviza is in the business, among other things, of marketing and selling advanced thermal processing and atomic layer deposition (“ALD”) equipment for the semiconductor industry.

C. Aviza wishes to fund the development by Trikon of control software for an existing Aviza process module in accordance with Aviza’s requirements [OMITTED].

D. Following the completion of such development work, Trikon wishes to make available (and Aviza wishes to purchase) transport modules and system controls incorporating Trikon software as modified pursuant to this Agreement, and Trikon wishes to grant (and Aviza to receive) certain license rights related to such items, all on the terms and conditions set forth in this Agreement.

Therefore, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:

AGREEMENT

ARTICLE I

Definitions and Construction

1.1 Definitions. The following capitalized terms have the meanings set forth below:

(a) “Acceptance Criteria” means the acceptance criteria for the Developed Software set forth in Exhibit A-3, as may be amended or supplemented by Parties.

(b) “Affiliate” means any entity that controls, is controlled by or is under common control with a Party. An entity shall be regarded as in control of another entity for purposes of this definition if it owns or controls more than fifty percent (50%) of the shares of the subject entity entitled to vote in the election of directors (or, in the case of an entity that is not a corporation, for the election of the corresponding managing authority).

(c) “Aviza Deliverable” means any tangible items to be delivered by Aviza to Trikon pursuant to the Development Plan.

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(d) “Aviza Dependencies” has the meaning specified in Exhibit A-2.

(e) “Aviza Dependency Dates” means the dates set forth in Exhibit A-2 as the dates by which the corresponding Aviza Dependencies must be satisfied in order for Trikon to be obligated to satisfy the Trikon Milestones by the corresponding Milestone Dates.

(f) “Aviza Process Modules” means the [OMITTED] process modules, including the current [OMITTED] process modules described in the Requirements and Development Plan.

(g) “Business Day” means any day other than a Saturday, Sunday or public or religious holiday that is actually observed generally by all public institutions or banks in San Francisco, California. A Business Day commences at 8:00 a.m. Pacific Time and concludes at 5:00 p.m. Pacific Time in the United States of America.

(h) “Commercial Units” has the meaning specified in Section 4.1.

(i) “Confidential Information” has the meaning specified in Section 8.1.

(j) “Controller” means Trikon’s existing PC-104 controller.

(k) “Derivative Work” has the meaning ascribed to it under the United States Copyright Law, Title 17 U.S.C. Sec. 101 et. seq., as the same may be amended from time to time.

(l) “Developed Software” means the control system software to be developed by Trikon under this Agreement for an Aviza Process Module, as described in the Requirements and Development Plan.

(m) “Development Fee” has the meaning specified in Section 5.1.

(n) “Development Plan” means the plan for the development of the Developed Software in accordance with the Requirements provided to Trikon by Aviza, set forth in Exhibit A, as such plan may be amended in accordance with the terms of this Agreement.

(o) “Improvement” means any adaptation, improvement, upgrade, update, enhancement, new version, bug-fix, patch, extension, or Derivative Work, as applicable.

(p) “Intellectual Property Rights” means the rights associated with the following: (i) all United States and foreign patents and applications therefor (“Patents”); (ii) all copyrights, copyright registrations and applications therefor and all other rights corresponding thereto throughout the world (“Copyrights”); (iii) all trademarks, service marks, trade names, trade dress rights and similar designation of origin and rights therein (“Marks”); (v) all rights in trade secrets and Confidential Information; and (vi) any similar, corresponding or equivalent rights to any of the foregoing any where in the world.

(q) “License Fee” has the meaning specified in Section 5.2.

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(r) “Licensed Product” means any Commercial Unit manufactured either by Aviza or for Aviza by a third party (other than Trikon) pursuant to the Manufacturing Rights granted in Section 7.2 that is Sold by Aviza to its end customers.

(s) “Manufacturing Documentation” has the meaning specified in Section 4.4.

(t) “Manufacturing Rights” has the meaning specified in Section 7.2.

(u) “Milestone Dates” means the dates set forth in Exhibit A-2 as the dates by which Trikon is required to satisfy the corresponding Trikon Milestones.

(v) “Payment Milestones” means those Trikon Milestones described in Article II as “Payment Milestones” and further described in Exhibit A-2, which, when satisfied by Trikon, require Aviza’s payment to Trikon of the specified portions of the Development Fee in accordance with Section 5.1.

(w) “Personnel” means, with respect to a Party, such Party’s employees working on such Party’s behalf. For clarity, Trikon and its employees shall not be considered working on Aviza’s behalf.

(x) “Project Managers” has the meaning specified in Section 3.1.

(y) “Requirements” means the functional and technical requirements for the Developed Software as agreed upon by the Parties pursuant to Section 2.3 and set forth in Exhibit A-1, as may be amended or supplemented by mutual agreement of the Parties.

(z) “Sale” means, for purposes of determining royalties payable to Trikon under Section 5.3, Aviza’s shipment of a Licensed Product to an end customer. The terms “Sell” and “Sold” will have the same meaning when used herein as the term “Sale.”

(aa) “Software” means the Transport Module Software and the Developed Software.

(bb) “Source Code” shall mean the human-readable form of software that can be compiled into executable code form, together with any documentation for the source code.

(cc) “Trikon Deliverables” means the Software and any other hardware, software, Source Code, documentation, test results or other tangible items or materials listed in this Agreement, including Exhibit A-1, to be delivered by Trikon to Aviza pursuant to this Agreement.

(dd) “Trikon Milestones” means the distinct milestones that are to be satisfied by Trikon in connection with its performance of the Development Plan as set forth in Exhibit A-2.

(ee) “Trikon Transport Module” means Trikon’s existing transport module on which Trikon’s Transport Module Software has been installed, with any modifications, including Improvements, made to such module by or on behalf of Trikon.

(ff) “Transport Module Software” means the Trikon proprietary transport module software as it exists on the Effective Date and as modified by Trikon during the term of the Agreement.

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1.2 Construction For purposes of this Agreement, whenever the context requires: the singular number will include the plural, and vice versa; the masculine gender will include the feminine and neuter genders; the feminine gender will include the masculine and neuter genders; and the neuter gender will include the masculine and feminine genders.

(b) The Parties waive the application of any law, regulation, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document.

(c) As used in this Agreement, the words “include” and “including,” and variations thereof, will not be deemed to be terms of limitation, but rather will be deemed to be followed by the words “without limitation.”

(d) Except as otherwise indicated, all references in this Agreement to “Sections” and “Exhibits” are intended to refer to Sections of this Agreement and Exhibits to this Agreement.

(e) The headings in this Agreement are for convenience of reference only, will not be deemed to be a part of this Agreement, and will not be referred to in connection with the construction or interpretation of this Agreement.

ARTICLE II

Development

2.1 General. In accordance with and subject to the terms of this Agreement, Trikon shall deliver to Aviza a Trikon Transport Module, and shall develop and deliver the Trikon Deliverables, including the Software in executable code and Source Code form, in accordance with the terms set forth below and in the Development Plan. The components of the Trikon Deliverables, including the Software, will conform to the Requirements. In accordance with Section 5.1, upon satisfaction by Trikon of the Payment Milestones, Aviza shall pay to Trikon the Development Fee.

2.2 Delivery of Existing Manufacturing Documentation and Software Source Code.

(a) As soon as practicable but no later than twenty-one (21) days after the Effective Date, Trikon shall provide Aviza with a copy of all documentation necessary for the manufacture of the Commercial Units that it possesses as of the Effective Date, including designs, vendor details and part numbers (the “Manufacturing Documentation”), and a copy of the Source Code for the Transport Module Software and the existing Trikon control system software, as documented as of the Effective Date.

(b) Updates to the Manufacturing Documentation and the Transport Module Software shall be provided as set forth in Section 2.5 and 4.4.

2.3 Requirements.

(a) Within seven (7) days after the Effective Date of this Agreement, Trikon shall supply to Aviza information regarding the software architecture and the requirements (e.g., input/output requirements) of the Controller and the performance capabilities of the control system software incorporated in the Controller as of the Effective Date for the control of Trikon’s existing [OMITTED] process module.

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(b) Within thirty (30) days after Aviza’s receipt of such information from Trikon, Aviza will deliver to the Trikon’s Project Manager, in electronic or other reasonable form, a copy of the proposed Requirements, which will be substantially based on the control systems software incorporated in the Controller as of the Effective Date for the control of Trikon’s existing [OMITTED] process module and Trikon’s descriptions of such control system software, but which will also take into account the unique, incremental features and functions of the Developed Software reasonably required by Aviza to enable the Trikon Transport Module to work successfully with the Aviza Process Module.

(c) Trikon shall review the Requirements submitted by Aviza promptly upon its receipt thereof and shall notify Aviza promptly if Trikon determines in good faith that the Requirements as proposed by Aviza are inconsistent with the general framework of Section 2.3(b) and either require significantly greater development resources than Trikon can bring to bear in the intended development time or Trikon cannot otherwise perform. The Parties will meet immediately thereafter and will use all reasonable efforts to resolve all outstanding issues regarding the Requirements and reach agreement as to the final set of Requirements as soon as possible. Concurrent with Aviza’s submission and the Parties’ discussion, if any, of the Requirements, the Parties will use all reasonable efforts to finalize the other related aspects of the Development Plan, including the Milestone Dates, Aviza Dependencies, Aviza Dependency Dates and Acceptance Criteria. The final Requirements will become part of this Agreement and will be attached hereto as Exhibit A-1. The final Milestone Dates, Aviza Dependencies, Aviza Dependency Dates and Acceptance Criteria will become part of this Agreement and will be attached hereto as Exhibits A-2 and A-3, as applicable.

2.4 First Payment Milestones – Delivery of Trikon Transport Module and the Existing Manufacturing Documentation and Source Code. Trikon shall deliver, on or prior to the First Milestone Date, a Trikon Transport Module within Aviza’s Scotts Valley site. Trikon’s delivery of the Trikon Transport Module at Aviza’s site shall constitute the occurrence of the “First Payment Milestone.” The Parties acknowledge that Trikon delivered the Trikon Transport Module at Aviza’s site as this Section 2.4 requires prior to this Agreement’s Effective Date.

2.5 Delivery of Documented Transport Module Software. By May 1, 2005, Trikon shall provide Aviza with a copy of the then-current version of the Source Code for the Transport Module Software written in a form and documented in such a manner so as to enable a software engineer reasonably skilled in the relevant software field to use and modify the Transport Module Software.

2.6 Second Payment Milestone – Delivery of Developed Software. Trikon shall deliver a copy of the Developed Software, in both executable code and Source Code form, to Aviza on or prior to the Second Milestone Date, which delivery shall constitute the occurrence of the “Second Payment Milestone.”

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2.7 Third Payment Milestone – Acceptance of Software Aviza’s acceptance of the Developed Software in accordance with this Section 2.7 shall constitute the occurrence of the “Third Payment Milestone.” Trikon shall satisfy the Third Payment Milestone by the Third Milestone Date. Trikon’s satisfaction of the Third Payment Milestone shall be determined in accordance with the following:

(i) Prior to delivery of the Developed Software to Aviza, Trikon will be given the opportunity to test and, if necessary, de-bug the Developed Software on a representative, functional Aviza Process Module, including, if required by Trikon, on the Trikon Transport Module provided at Aviza’s Scotts Valley site.

(ii) Upon receipt of the Developed Software under Section 2.6, Aviza shall test the Developed Software to determine if it meets the Acceptance Criteria for the Developed Software.

(iii) If Aviza rejects the Developed Software, it shall provide the Trikon Project Manager with a written notice of rejection within thirty (30) days from the date of its initial receipt of the Developed Software (and similarly in the case of a second or subsequent test of the Developed Software in accordance with Section 2.7(a)(iv), below; such period the “Acceptance Period”). Failure of Aviza to provide such rejection notice in the Acceptance Period shall be deemed acceptance of the Developed Software and the satisfaction by Trikon of the Third Payment Milestone.

(iv) Aviza may only issue a rejection notice if it determines that the Developed Software fails to comply with the relevant Acceptance Criteria. A rejection notice shall set forth in detail the reasons for Aviza’s rejection of the Developed Software.

(v) Upon receipt of the rejection notice, Trikon shall have a reasonable amount of time but no more than fifteen (15) days after receipt of such notice to correct any nonconformance or defect in the Developed Software and to return an updated copy of Developed Software to Aviza for acceptance as provided in this Section 2.7. Upon receipt of such updated Developed Software, Aviza shall re-commence acceptance testing in accordance with Section 2.7(a)(i) above.

(vi) Subject to Sections 2.7(a)(i) through 2.7(a)(iv), the above acceptance procedures shall be repeated until the Developed Software meets the Acceptance Criteria or Aviza properly exercises it termination rights in accordance with Section 13.2.

(b) Once the Developed Software is accepted by Aviza in accordance with the foregoing, for all purposes under this Agreement, the date on which such Third Payment Milestone is deemed to have been satisfied shall be the date on which Aviza accepts the version of the Developed Software that meets the relevant Acceptance Criteria.

2.8 Milestone Dependencies

(a) Aviza shall satisfy the Aviza Dependencies, including providing Trikon with the Aviza Deliverables, by the Aviza Dependency Dates and otherwise fully cooperate with Trikon to enable Trikon’s performance of the Development Plan, all in accordance with the Development Plan.

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(b) Trikon’s satisfaction of the Trikon Milestones by the corresponding Milestone Dates is dependent upon Aviza’s satisfaction of the Aviza Dependencies by the corresponding Aviza Dependency Dates. Any delay by Aviza in satisfying a Aviza Dependency by the corresponding Dependency Date shall automatically result in all subsequent Trikon Milestone Dates being extended day-for-day by the delay of Aviza satisfying the Aviza Dependency.

ARTICLE III

Project Management

3.1 Project Managers. Each Party shall appoint a principal point of contact to be its project manager (the “Project Managers”) who shall coordinate and act as liaisons with the other Party with respect to this Agreement.

3.2 Responsibilities. The Project Managers responsibilities shall generally include overseeing and supervising its Party’s fulfillment of its obligations under the Development Plan, understanding the obligations of the other Party under the Development Plan, discussing Project’s progress, and identifying barriers to success, key issues and issues-resolution options with the other Party’s Project Manager.

3.3 Appointment. Trikon hereby appoints Gordon Green as its Project Manager, and Aviza hereby consents to such appointment. Aviza hereby appoints Alex Anderson as its Project Manager, and Trikon hereby consents to such appointment.

3.4 Replacement. If a Party’s Project Manager is unable to continue to serve for any reason, or a Party otherwise wishes to replace its Project Manager, such Party shall propose a successor and shall introduce the individual to the other Party. In addition, such Party shall provide the other Party with a resume and any other information about the individual that the other Party reasonably requests.

3.5 Facilities. The Project Managers shall each be provided with reasonable facilities at the locations of the other Party as necessary to permit each Project Manager to perform its obligations or exercise the rights of its Party under this Agreement.

3.6 Development Access.

(a) By Aviza. To the extent reasonably required to enable Aviza to review Trikon’s performance under this Agreement, and subject to reasonable controls by Trikon with respect to access to its Confidential Information, Trikon shall provide Aviza with reasonable access to the Trikon development team involved in the development of the Trikon Deliverables.

(b) By Trikon. To the extent reasonably required for Trikon to fulfill its obligations under the Development Plan, and subject to reasonable controls by Aviza with respect to access to its Confidential Information, Aviza shall provide Trikon with reasonable access to the Aviza development team involved in the development of the Aviza Deliverables.

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ARTICLE IV

Post-Development Supply and License

4.1 Supply Commitment. Aviza will have the right to order Trikon Transport Modules along with Controllers incorporating the Developed Software (“Commercial Units”) from Trikon, and Trikon shall, provided Aviza’s quantity requirements are reasonable, supply such Commercial Units to Aviza in accordance with lead times reasonably required by Trikon but not to exceed: (a) twelve (12) weeks if Aviza’s order is for one (1) unit, and if at the time of receipt of the Aviza order for such unit, Trikon has no other orders from Aviza for a Commercial Unit currently in its manufacturing queue, and (b) sixteen (16) weeks for all other orders. Subject to the foregoing, Trikon shall endeavor to supply the Commercial Units to Aviza sooner than the not to exceed lead times set forth above in order to meet Aviza’s requested shipment date. Aviza’s purchase of such Commercial Units will be governed by both the applicable terms and conditions of this Agreement and the purchase terms and conditions attached hereto as Exhibit 4.1, which are incorporated herein by reference. In the event of a conflict between those standard terms and conditions and those contained in this Agreement, this Agreement will prevail. The terms of this Agreement and the terms and conditions attached hereto as Exhibit 4.1 shall prevail over any additional or inconsistent terms set forth in any purchase order, acknowledgement, or other document exchanged between the Parties in connection with the purchase and sale of the Commercial Units, and any such additional or inconsistent terms are hereby rejected. Trikon’s supply obligations under this Section 4.1 shall terminate once Trikon has supplied Aviza with eight (8) Commercial Units (the “Required Units”). Subject to the foregoing, Aviza shall place purchase orders for the Required Units within twenty-four (24) months after completion of the Development Plan for delivery no later than thirty (30) months after the Effective Date.

4.2 Price. Trikon’s price to Aviza for the Commercial Units under this Article IV shall be [OMITTED], calculated consistently with the representative example contained in Exhibit 4.2 (which sets forth the materials costs necessary to supply the Trikon Transport Module as it exists as of the Effective Date and also sets forth the overhead and labor costs that will be included in the calculation of the price for the Commercial Units; while in general, Exhibit 4.2 serves as a representative sample of costs to be included in the calculation of the price for the Commercial Units, the parties agree that [OMITTED].

4.3 Limitation. Subject to Section 4.1, nothing in this Agreement obligates Trikon to make, use, sell or otherwise commercialize any Commercial Units.

4.4 Manufacturing Documentation and Software Updates.

(a) Manufacturing Documentation Updates. During the term of this Agreement, Trikon will deliver to Aviza any and all updates to the Manufacturing Documentation that are directly relevant to the Trikon Transport Modules used by Aviza and supplied hereunder, on the same schedule as Trikon internally issues engineering changes orders for such updates.

(b) Software Updates. Beginning with the delivery of Software under this Agreement and ending June 1, 2008, Trikon shall provide to Aviza any and all updates, including any Improvements, made by Trikon to the Software that are directly relevant to the Trikon Transport Modules used by Aviza and supplied hereunder, in accordance with the support terms in the form of Exhibit B (the details of such support to be defined at a later date by the parties), on Trikon’s normal release schedule.

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ARTICLE V

Fees and Payment

5.1 Development Fee. Aviza shall pay to Trikon a total of one million two hundred thousand dollars ($1,200,000.00) (the “Development Fee”) in consideration for and conditioned upon Trikon’s satisfaction of the Payment Milestones set forth in Article II. Upon the occurrence of the Payment Milestones as set forth below, Trikon will issue to Aviza an invoice for the portion of the Development Fee then due and Aviza shall pay the Development Fee in accordance with the following:

(a) First Payment: Nine hundred thousand dollars ($900,000.00) (the “First Payment”) shall be paid by Aviza to Trikon within thirty (30) days after the satisfaction of the First Payment Milestone (Delivery of Trikon Transport Module) in accordance with Section 2.4. The Parties acknowledge that Aviza paid the First Payment to Trikon prior to this Agreement’s Effective Date and that all of the Aviza Dependencies relating to the First Payment Milestone have been satisfied.

(b) Second Payment: An additional two hundred thousand dollars ($200,000.00) (the “Second Payment”) shall be paid by Aviza to Trikon within thirty (30) days after the satisfaction of the Second Payment Milestone (Delivery of Software) in accordance with Section 2.6; and

(c) Third Payment: An additional one hundred thousand dollars ($100,000.00) (the “Third Payment”) shall be paid by Aviza to Trikon within thirty (30) days of the satisfaction of the Third Payment Milestone (Acceptance of Software) in accordance with Section 2.7.

5.2 License Fee. In addition to the Development Fee, and in consideration of the license rights granted to Aviza as set forth in 7.2, Aviza shall pay to Trikon a non-refundable, one-time fee of four million dollars ($4,000,000.00) (the “License Fee”), which shall be due and which Aviza shall pay in accordance with the following:

(a) Two million dollars ($2,000,000.00) shall be paid by Aviza to Trikon upon this Agreement’s Effective Date; and

(b) A second two million dollars ($2,000,000.00) shall be paid by Aviza to Trikon on or before July 31, 2005.

5.3 Royalties. Aviza shall additionally pay to Trikon a royalty of [OMITTED] provided that in no event shall Aviza be required to pay an aggregate amount in excess of two million dollars ($2,000,000.00) under this Section 5.3. Aviza shall pay such royalties to Trikon within [OMITTED] by Aviza or its Affiliates. Aviza shall keep and maintain, and Trikon shall have the right to access and audit, such books and records as reasonably necessary to confirm Aviza’s performance of its payment obligations under this Section 5.3.

5.4 Taxes. In addition to the payments described above, Aviza shall pay the invoiced sales and use tax, but excluding any tax based upon the net income of Trikon, if imposed by any government as a result of payments made to Trikon under this Agreement.

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5.5 Payment Method. All amounts payable under this Agreement shall be made by bank-wire transfer in immediately available funds to an account that Trikon designates, or such other reasonable method as the parties may mutually agree upon from time to time; provided, however, that if Aviza’s payment is made via bank-wire transfer, then the time period specified herein for Aviza’s payment of any fees or royalties under this Agreement will be extended by an additional three (3) days. All amounts shall be paid in U.S. dollars (unless the Parties agree otherwise). Any payments or portions of payments due under this Agreement that are not paid by the date such payments are due under this Agreement shall bear interest equal to the lesser of (a) twelve percent (12%) per year, or (b) the maximum rate permitted by law, pro rated to reflect the number of days such payment is delinquent.

ARTICLE VI

IP Rights and Ownership

6.1 General IP Ownership. Except as provided in this Article VI, and subject to the licenses expressly granted under this Agreement, each Party shall continue to own all Intellectual Property Rights owned by it prior to the Effective Date or developed by that Party following the Effective Date, regardless of whether such Intellectual Property Rights were created or acquired in connection with this Agreement.

ARTICLE VII

IP and Software Licenses

7.1 General. Except as set forth in this Article VII, neither Party grants to the other any rights or licenses under its Intellectual Property Rights.

7.2 Granted By Trikon.

(a) Grant. Subject to the terms of this Agreement, Trikon grants to Aviza a nonexclusive (except as provided in Section 7.2(b)), worldwide, nontransferable (except as provided in Section 14.6), perpetual (subject to Section 13.4(a)), irrevocable (subject to Section 13.4(a)), royalty-bearing (in accordance with Section 5.3) right and license, under Trikon’s Intellectual Property Rights:

(i) to make, have made, use, offer for Sale, Sell, import and export Licensed Products as part of complete wafer fabrication systems that include Aviza Process Modules (“Manufacturing Rights”); and

(ii) to use, copy, modify, create derivative works of the Software and to distribute the Software in object-code form as part of Licensed Products through multiple tiers of distribution.

(b) Exclusivity. With respect only to the Developed Software, the right and license granted to Aviza under Section 7.2(a)(ii) shall be exclusive, even as to Trikon.

(c) Sublicenses. Aviza may sublicense use of the Software in object-code form to its end-user customers, as part of or for use with Licensed Products, pursuant to licensing terms in the normal course of Aviza’s business. Subject to the preceding sentence, the rights and licenses granted to Aviza under this Section 7.2 are nonsublicensable.

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7.3 Delivery. Notwithstanding the licenses granted in this Article VII, Trikon shall have no obligation to deliver any Software, Manufacturing Documentation or other tangible items to Aviza except as provided in Article II and Section 4.4.

ARTICLE VIII

Confidentiality

8.1 Confidential Information. As used in this Agreement, “Confidential Information” means any information: disclosed by one Party (the “Disclosing Party”) to the other Party (the “Receiving Party”) which, if in written, graphic, machine-readable or other tangible form is marked as “Confidential” or “Proprietary,” or which, if disclosed orally or by demonstration, is identified at the time of initial disclosure as confidential and is reduced to writing marked as “Confidential” or “Proprietary” and provided to the Receiving Party within thirty (30) days after initial disclosure; provided that the Source Code and the Manufacturing Documentation provided by Trikon under this Agreement shall be considered Trikon’s Confidential Information whether or not marked as such.

8.2 Confidential Information Exclusions. Confidential Information excludes information that is: (a) now or hereafter, through no unauthorized act or failure to act on Receiving Party’s part, is or becomes generally known in the public domain; (b) known to the Receiving Party from a source other than the Disclosing Party (including former employees of the Disclosing Party) without an obligation of confidentiality at the time Receiving Party receives the same from the Disclosing Party; (c) hereafter furnished to the Receiving Party by a third party as a matter of right and without restriction on disclosure; or (d) independently developed by the Receiving Party without use of the Disclosing Party’s Confidential Information.

8.3 Mandatory Disclosures. Nothing in this Agreement shall prevent the Receiving Party from disclosing Confidential Information to the extent the Receiving Party is legally compelled to do so by any governmental investigative or judicial agency pursuant to proceedings over which such agency has jurisdiction; provided, however, that prior to any such disclosure, the Receiving Party shall (a) assert the confidential nature of the Confidential Information to the agency; (b) immediately notify the Disclosing Party in writing of the agency’s order or request to disclose; and (c) cooperate fully with the Disclosing Party in protecting against any such disclosure and/or obtaining a protective order narrowing the scope of the compelled disclosure and protecting its confidentiality.

8.4 Confidentiality Obligation. Receiving Party shall not use or disclose the Confidential Information of the other Party for any purpose other than to the extent necessary to perform its respective obligations and to exercise its respective rights and licenses under this Agreement, for so long as such information is not excluded from the definition of Confidential Information under Section 8.2. To the extent that the disclosure of Confidential Information is reasonably required in order to exercise “have made” or sublicense rights expressly granted under Section 7.2(a)(i), such disclosure shall be made under written confidentiality obligations at least as protective as those set forth in this Article VIII. Receiving Party shall take the same measures to protect the Confidential Information of the Disclosing Party as it takes with respect to its own Confidential Information of like or similar importance, but in no event less than the degree of care that would be exercised by a prudent person given the sensitivity and strategic value of such Confidential Information.

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8.5 Confidentiality of Agreement.

(a) Public or Industry Announcement. Except as required by law, neither Party may make any official press release, industry disclosure, announcement or engage in other publicity (an, “Announcement”) relating to this Agreement without first obtaining the prior written consent of the other Party (such consent not to be unreasonably withheld or delayed), unless such Announcement follows an Announcement made by the other Party.

(b) Disclosure of Agreement. Subject to Section 8.5(a), each Party may disclose the existence of this Agreement as it deems appropriate, provided that neither Party shall disclose any specific terms of this Agreement, except: (a) as may be required by law; (b) to legal counsel of the Parties; (c) in connection with the requirements of a public offering or other securities filing; (d) in confidence, to accountants, attorneys, banks, and financing sources and their advisors who are subject to reasonable confidentiality obligations; (e) in confidence, in connection with the enforcement of this Agreement or exercise of its rights under this Agreement; or (f) in confidence, in connection with a merger or acquisition or proposed merger or acquisition, or the like.

ARTICLE IX

Representations and Warranties

9.1 Mutual Representations and Warranties. Each Party hereby represents and warrants to the other Party as follows:

(a) Corporate Authority. It has the right to enter this Agreement, is a corporation duly organized, validly existing, and in good standing under the laws of Delaware, has the power and authority, corporate and otherwise, to execute and deliver this Agreement and to perform its obligations under this Agreement, and has by all necessary corporate action duly and validly authorized the execution and delivery of this Agreement and the performance of its obligations under this Agreement.

(b) No Conflicts. The execution, delivery and performance by it of this Agreement will not: (i) conflict with or violate the articles or certificate of incorporation or by-laws of it or any provision of any law, rule, regulation, authorization or judgment of any governmental authority having applicability to it or its actions; or (ii) conflict with or result in any breach of, or constitute a default under, any note, security agreement, commitment, contract or other agreement, instrument or undertaking to which it is a party or by which any of its property is bound.

(c) Compliance with Law. It shall comply with all applicable laws relating to its performance under this Agreement.

9.2 Trikon Representations and Warranties.

(a) Performance. Trikon represents and warrants to Aviza that (i) the Developed Software supplied by Trikon hereunder will perform in accordance with the Requirements for ninety (90) days following Aviza’s acceptance under Section 2.7) and (ii) the Transport Module Software and the Commercial Units supplied by Trikon hereunder will perform in accordance with the terms of Trikon’s standard commercial product and software warranties, provided that for Software and Commercial Units that Aviza subsequently distributes to customers, the warranty periods applicable to such standard Trikon’s warranties shall be deemed to extend, on a customer-by-customer basis, for the

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duration of warranty given by Aviza to its customer (provided that in no event shall Trikon’s deemed warranty period extend more than [OMITTED] from the date the Commercial Unit or Software has been delivered to Aviza.

(b) Non-Infringement. Trikon represents and warrants to Aviza that it has all of the necessary rights and licenses to develop and provide the Software, the Commercial Units and the Manufacturing Documentation to Aviza and that Aviza’s use of the Software, the Commercial Units or the Manufacturing Documentation will not infringe any third party’s Intellectual Property Rights; provided that Aviza’s sole remedy for breach of the foregoing shall be the indemnity as set forth in Article X and termination of this Agreement as provided in Section 13.3.

9.3 Existing Manufacturing Documentation and Software. EXCEPT FOR THE WARRANTY OF NON-INFRINGEMENT SET FORTH IN SECTION 9.2(b), AND WITHOUT LIMITING TRIKON’S OBLIGATIONS OR AVIZA’S RIGHTS UNDER ARTICLE X (INDEMNITY), BUT NOTWITHSTANDING ANY OTHER PROVISIONS IN THIS AGREEMENT TO THE CONTRARY, THE MANUFACTURING DOCUMENTATION AND SOFTWARE DELIVERED UNDER SECTION 2.2 ARE PROVIDED “AS-IS,” WITHOUT ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND.

9.4 Disclaimer. EXCEPT AS EXPRESSLY PROVIDED OTHERWISE IN THIS AGREEMENT, EACH PARTY SPECIFICALLY DISCLAIMS ANY AND ALL OTHER WARRANTIES, EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED, TO ANY IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

ARTICLE X

Indemnity

10.1 Indemnification by Trikon. Trikon shall, at its expense, defend Aviza against, or in its discretion settle (provided that such settlement unconditionally releases Aviza), any third-party claim brought against Aviza alleging that the performance by Trikon hereunder and any Trikon Deliverable provided infringes any Patent or Copyright of a third party, or misappropriates any trade secrets of a third party, and shall indemnify and hold Aviza harmless from and against any liabilities, damages, costs and expenses awarded by a court or settlements entered into based on such claim, and reasonable costs and expenses (including reasonable attorneys’ fees) incurred by Aviza relating to the defense or settlement of such claim. As a condition to such defense and indemnification, Aviza must provide Trikon with prompt written notice of the claim, permit Trikon to control the defense, settlement, adjustment or compromise of any such claim, cooperate with Trikon in the defense and any related settlement action upon Trikon’s reasonable request and at Trikon’s expense.

10.2 Remedies. If any Trikon Deliverable or any part thereof becomes, or in Trikon’s reasonable opinion is likely to become, the subject of a third-party claim of infringement, Trikon shall have the right, at its option and expense, to obtain for Aviza a license permitting the continued use of the Trikon Deliverable or to replace or modify the Trikon Deliverable so that it becomes non-infringing, provided that any such change will not materially affect performance or functionality. If Trikon determines, in its reasonable judgment, that to pursue either of the two options described above would materially jeopardize its long-term financial viability, and a third-party claim of infringement is brought,

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then Aviza will be entitled to receive a reasonable refund of the fees paid to Trikon under this Agreement and to terminate this Agreement pursuant to Section 13.3. Notwithstanding the foregoing, Trikon’s indemnity obligation under this Article X shall not extend to any third party infringement claims to the extent the claims arise out of or are based on any continued use or distribution of the infringing portion of the Trikon Deliverable more than the earlier of eighteen (18) months after the claim is brought or one hundred and eighty (180) days after such claim is finally decided by a court of competent jurisdiction in the claimant’s favor.

10.3 Limitations. Trikon’s indemnity obligation in this Article X shall not extend to any claims to the extent the claims arise out of or are based upon (i) a modification of the Trikon’s Deliverables by any party other than Trikon without Trikon’s prior written consent; (ii) a combination of the Trikon’s Deliverables or any part thereof, with hardware or software not provided by Trikon, where the combination is the basis of the claim except for the contemplated combination with the Aviza Process Module; or (iii) use of other than the most current version of the Software (if the Software has not been altered in a way that materially affects performance or functionality) if infringement could have been avoided by use of such current version.

ARTICLE XI

Limitation of Liability

11.1 CONSEQUENTIAL DAMAGES. EXCEPT FOR AMOUNTS PAYABLE TO THIRD PARTIES UNDER ARTICLE X, AND MATERIAL BREACHES OF THE PARTIES’ RESPECTIVE CONFIDENTIALITY OBLIGATIONS UNDER ARTICLE VIII, UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE OTHER UNDER ANY CONTRACT, STRICT LIABILITY, NEGLIGENCE OR OTHER LEGAL OR EQUITABLE THEORY, FOR (1) ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST PROFITS IN CONNECTION WITH THE SUBJECT MATTER OF THIS AGREEMENT, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS SECTION DOES NOT LIMIT EITHER PARTY’S LIABILITY FOR BODILY INJURY OF A PERSON, DEATH, OR PHYSICAL DAMAGE TO PROPERTY.

11.2 LIMITATION OF LIABILITY.

EXCEPT FOR AMOUNTS PAYABLE BY TRIKON TO THIRD PARTIES UNDER ARTICLE X, AND MATERIAL BREACHES OF EITHER PARTY’S CONFIDENTIALITY OBLIGATIONS UNDER ARTICLE VIII, EACH PARTY’S AGGREGATE LIABILITY TO THE OTHER PARTY ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY, REGARDLESS OF WHETHER SUCH CLAIM IS MADE ON THE BASIS OF CONTRACT, TORT, OR OTHER THEORY SHALL BE LIMITED TO THE AGGREGATE AMOUNTS PAID OR PAYABLE UNDER THIS AGREEMENT.

ARTICLE XII

Governing Law

12.1 Governing Law. This Agreement shall be governed by, and construed in accordance with, the Laws of the State of California, without regard to laws that may be applicable under conflicts of laws principles. The parties specifically disclaim the UN Convention on Contracts for the International Sale of Goods.

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ARTICLE XIII

Term and Termination

13.1 Term of Agreement. This Agreement shall be effective upon the Effective Date and shall remain in force until the earlier of: (a) June 1, 2008, or (b) the effective date on which the Agreement is otherwise terminated as set forth in this Article XIII.

13.2 Termination by Aviza. Aviza may terminate this Agreement at any time for its convenience, for no reason or for any reason, upon delivery of written notice to Trikon. Termination shall be effective thirty (30) days following Trikon’s receipt of such termination notice.

13.3 Termination for Cause. Either party may terminate this Agreement, upon notice to the other party, if the other party materially breaches any provision of this Agreement and fails to cure such breach within thirty (30) days of its receipt of notice of said breach from the non-breaching party.

13.4 Effect of Termination.

(a) Survival. Each Party’s rights and obligations under Articles 6, 7, 8, 9, 10, 11, 12 and 14 and Sections 5.3, 5.4, 5.5 and 13.4 shall survive any termination or expiration of this Agreement; provided that Article VII shall not survive if Trikon terminates the Agreement for cause or Aviza terminates the Agreement for convenience prior to payment of the Development Fee and the License Fee.

(b) Return of Materials. Within thirty (30) days after the termination or expiration of this Agreement, each Party shall deliver to the other Party or destroy and certify as to the destruction of all of the Confidential Information and other property of the other Party in its possession; provided that except as provided in Section 13.4(a), all licenses granted to Aviza pursuant to Article VII shall continue in effect notwithstanding any such termination or expiration of this Agreement.

ARTICLE XIV

Miscellaneous

14.1 Force Majeure. Neither Party shall be liable to the other for delays or failures (other than payment) in performance resulting from causes beyond the reasonable control of that Party, including, but not limited to, acts of God, labor disputes or disturbances, material shortages or rationing, riots, acts of war, governmental regulations, communication or utility failures, or casualties.

14.2 Import and Export. Upon request, each Party shall promptly provide all information under its control which is necessary or useful for the other Party to obtain any export or import licenses required for such Party to ship or receive Commercial Units. The Parties agree to comply with all applicable export laws and regulations of the United States.

14.3 Relationship of Parties. The Parties are independent contractors under this Agreement and no other relationship is intended, including a partnership, franchise, joint venture, agency, employer/employee, fiduciary, master/servant relationship, or other special relationship. Neither Party shall act in a manner which expresses or implies a relationship other than that of independent contractor, nor bind the other Party.

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14.4 No Third Party Beneficiaries. Unless otherwise expressly provided, no provisions of this Agreement are intended or shall be construed to confer upon or give to any person or entity other than Aviza and Trikon any rights, remedies or other benefits under or by reason of this Agreement.

14.5 Notices. Any notice required or permitted to be given by either Party under this Agreement shall be in writing and shall be personally delivered or sent by a reputable overnight mail service (e.g., Federal Express), or by first class mail (certified or registered), or by facsimile confirmed by first class mail (registered or certified), to the Project Manager of the other Party. Notices will be deemed effective (i) three (3) working days after deposit, postage prepaid, if mailed, (ii) the next day if sent by overnight mail, or (iii) the same day if sent by facsimile and confirmed as set forth above. A copy of any notice shall be sent to the following:

Aviza Technology, Inc. Attn: Chief Financial Officer 440 Kings Village Road Scotts Valley, CA 95066 Fax:                              Trikon Technologies, Inc. Ringland Way Newport NP18 UK Attn: Chief Financial Officer Fax:                             

14.6 Assignment. Neither Party may assign this Agreement without the prior written consent of the other Party; except that either party may assign this Agreement without the other party’s consent in connection with a change of control or to an entity that acquires all or substantially all of the business or assets of that party, in each case whether by merger, sale of assets, or otherwise, provided that the assignee assumes and agrees in writing to be bound by all of the obligations of the assigning party under this Agreement. Any attempted assignment or delegation in violation of this Section 14.6 will be void. Subject to the foregoing, the provisions of this Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns.

14.7 Waiver and Modification. Failure by either Party to enforce any provision of this Agreement will not be deemed a waiver of future enforcement of that or any other provision. Any waiver, amendment or other modification of any provision of this Agreement will be effective only if in writing and signed by the Parties.

14.8 Severability. If for any reason a court of competent jurisdiction finds any provision of this Agreement to be unenforceable, that provision of the Agreement will be enforced to the maximum extent permissible so as to effect the intent of the Parties, and the remainder of this Agreement will continue in full force and effect.

14.9 Trademarks. Nothing in this Agreement grants either Party any rights to use the other Party’s Marks, directly or indirectly, in connection with any product, service, promotion, or to make any publication or publicity without prior written approval of the other Party.

14.10 Freedom of Action. Each Party agrees that this Agreement does not create an exclusive relationship between the parties, and both parties may enter into agreements with other parties for same or similar work, or to make, have made, use, sell, buy, develop, market or otherwise transfer any products or services, now or in the future, provided that any such agreement does not cause either party to be in breach of any of their obligations under this Agreement or constitute a violation of either party’s Intellectual Property Rights.

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14.11 Entire Agreement. This Agreement, including all exhibits which are incorporated herein by reference, constitutes the entire agreement between the Parties with respect to the subject matter hereof, and supersedes and replaces all prior and contemporaneous understandings or agreements, written or oral, regarding such subject matter.

14.12 Counterparts. This Agreement may be executed in two counterparts, each of which shall be an original and together which shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement by persons duly authorized as of the date and year first above written.

TRIKON TECHNOLOGIES, INC.		AVIZA TECHNOLOGY, INC.
By:	/S/ John Macneil	By:	/S/ Jerauld J. Cutini
Name:	John Macneil	Name:	Jerauld J. Cutini
Title:	Chief Executive Officer	Title:	President

[Signature Page to Aviza/Trikon JDA]

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EXECUTION COPY – 3/14/05

EXHIBIT A

[DEVELOPMENT PLAN]

[EXHIBIT A HAS NOT BEEN EXECUTED BY THE PARTIES]

EXECUTION COPY – 3/14/05

EXHIBIT A-1

[REQUIREMENTS]

[EXHIBIT A1 HAS NOT BEEN EXECUTED BY THE PARTIES]

EXECUTION COPY – 3/14/05

EXHIBIT A-2

TRIKON MILESTONES

Payment Milestone	Aviza Dependency	Milestone Date
Delivery of Trikon Transport Module	Completed as of the Effective Date	[Insert date Module was delivered]
Delivery of Developed Software
Acceptance of Software

EXECUTION COPY – 3/14/05

EXHIBIT A-3

[ACCEPTANCE CRITERIA]

[EXHIBIT A3 HAS NOT BEEN EXECUTED BY THE PARTIES]

EXHIBIT B

SOFTWARE SUPPORT TERMS

Trikon’s general procedure for providing new software releases is as follows:

1. Periodically define requirements for release based upon overall customer input and the database of bugs. Requirements document is released.

2. Inform customers of what is targeted to be in a release.

3. Design and code features as per requirements document.

4. Produce test plan based on requirements document.

5. As final cut off date for release approaches, drop low priority requirements.

6. Execute test plan.

7. Based on results of test plan, fix bugs picked up and re-test.

8. Produce release notes and installation instructions.

9. Produce software release CD.

10. Inform customers using a client service bulletin (CSB) which contains release notes and installation instructions.

EXHIBIT 4.1

PURCHASE TERMS AND CONDITIONS

This Exhibit 4.1 sets forth the terms and conditions (“Conditions”) pursuant to which Aviza will purchase the Commercial Units from Trikon pursuant to Article IV of the JDA (as defined below). The terms and conditions of the JDA, including those which are specifically referenced herein and those which by their nature apply to the purchase of the Commercial Units by Aviza from Trikon, are hereby incorporated by reference.

1. Definitions. In these Conditions:

“Aviza” means Aviza Technology, Inc., and any company controlling, controlled by or under common control with this company;

“The Goods” means the quantity of Commercial Units (as defined in the JDA) described in the Order;

“The Order” means an order placed by Aviza for Commercial Units placed under Article IV of the JDA;

“The Price” means the price of the Commercial Units as set forth in Section 4.2 of the JDA;

“The Supplier” means Trikon Technologies, Inc. (“Trikon”); and

“The JDA” means the Joint Development Agreement dated March 11, 2005, between Trikon and Aviza.

2. Acceptance of Orders by Supplier. No Orders shall be binding on Supplier unless accepted in writing. Supplier agrees that it will accept all Orders from Aviza for the Required Units (as defined in the JDA) that request a delivery date within the lead times specified in Section 4.1 of the JDA, provided Aviza’s quantity requirements are reasonable. As applicable, each party will notify the other of its available manufacturing capacity and its forecast of anticipated requirements, and of any material changes thereto, as soon as reasonably practical after that party becomes aware of that information.

3. Delivery of the Goods. Subject to Section 4.1 of the JDA, the time and place of delivery of the Goods are as specified in the Order. The terms of delivery shall be F.O.B. Supplier’s place of manufacture or other point of shipment in the United Kingdom (the “F.O.B. point”). Supplier’s obligation to deliver shall not have been met until the Goods and the documentation as required per the Order, including any certificates, maintenance instructions and manuals, have been delivered at the F.O.B. point. Unless expressly specified in the Order by Aviza, the delivery of Goods shall be non-recurring. If the Goods are agreed to be delivered/provided in installments, then the Order is deemed not to be severable. The Supplier shall notify Aviza as soon as reasonably possible of any delay or potential delay in the execution of the Order, and will state the events causing such delay. Supplier shall be responsible for additional expenses to deliver the Goods in an expedited manner or in a manner reasonably requested by Aviza if Goods are not delivered in accordance with timeframes set forth in the Order.

4. Rescheduling, Changes and Cancellations. Subject to Section 4.1 of the JDA, Aviza reserves the right at any time prior to shipment to suspend the delivery of any Goods, without any additional charge,

for up to one hundred and twenty (120) days after the originally scheduled shipment date. In addition, Aviza may terminate the Order in whole or in part upon notice to Supplier at least thirty (30) days prior to the original shipment date for the Goods subject to such Order; provided, however, that Aviza shall pay Supplier for all materials costs incurred by Supplier for the Goods subject to the cancellation, and Aviza will own all of those materials. Orders may not be canceled within thirty (30) days prior to the original shipment date. Notwithstanding anything to the contrary set forth in this Section 4, Aviza shall have no right to reschedule, cancel or otherwise change Orders in a manner that would delay the complete delivery of the eight (8) Required Units under the JDA to a date more than thirty (30) months after the JDA’s Effective Date.

5. Acceptance of Goods. The Goods are subject to inspection and testing by Aviza. In any case where the Goods (whether or not inspected or tested by Aviza) do not comply with the requirements of the JDA, Aviza has the right to reject such Goods. When rejecting Goods, Aviza shall give notice of rejection to the Supplier specifying the reasons for the rejection and shall return the rejected Goods to the Supplier at the Supplier’s risk and expense. In that case the Supplier shall, in its discretion repair the rejected Goods or replace the rejected Goods with Goods which are in accordance with the JDA, or if neither option is possible, refund the amounts paid by Aviza for such Goods.

6. Title and Risk of Loss. The title to and risk of loss pertaining to the Goods passes to Aviza on delivery of the Goods to Aviza at the F.O.B point, without prejudice to any right of Aviza to reject such Goods under these Conditions or otherwise.

7. Packaging. The Supplier shall package and label the Goods in a manner suitable for transit and storage at the Supplier’s expense in accordance with the Order. All packaging other than returnable packing shall become Aviza’s property unless Aviza indicates otherwise, in which case the Supplier shall be obliged to dispose of the packaging at its own risk and expense.

8. Price. The Price shall include all license fees, taxes, excise, duties and costs, both direct and indirect, of supplying the Goods except that, where the Goods are subject to Value Added Tax, the amount legally due shall be specified as a separate item of account.

9. Government Contracts. If the Goods are to be used by Aviza in the performance of a government contract or subcontract, those clauses of the applicable governmental procurement regulations that are required by federal law to be included in government contracts or subcontracts will be deemed to apply to the Order and will be incorporated by reference.

10. Warranty. The Goods will be warranted as set forth in Section 9.2 of the JDA.

11. Indemnity. Supplier will indemnify Aviza for all Goods purchased in accordance with Article X of the JDA.

12. Limitation of Liability. The limitation of liability contained in Article XI of the JDA will apply to all Goods purchased by Aviza hereunder.

13. Payment. Aviza shall pay to Supplier [OMITTED] of the total invoiced amount for the Goods within [OMITTED] days after shipment of the Goods, and the remaining [OMITTED] within [OMITTED] days after the shipment thereof.

EXHIBIT 4.2

[COST AND PRICE CALCULATION]

[OMITTED]

EX-10.2

Exhibit 10.2

INDEMNIFICATION AGREEMENT

This Indemnification Agreement (“Agreement”) is entered into as of the 31st day of March, 2005 by and between Trikon Technologies, Inc., a Delaware corporation (the “Company”), and Martyn Tuffery (“Indemnitee”).

RECITALS

A.    The Company and Indemnitee recognize the significant cost of directors’ and officers’ liability insurance and the general reductions in the coverage of such insurance.

B.    The Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting directors, officers, employees, agents and fiduciaries to expensive litigation risks at the same time as the availability and coverage of liability insurance has been severely limited.

C.    Indemnitee does not regard the current protection available as adequate under the present circumstances, and Indemnitee and other directors, officers, employees, agents and fiduciaries of the Company may not be willing to continue to serve in such capacities without additional protection.

D.    The Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve the Company and, in part, in order to induce Indemnitee to continue to provide services to the Company, wishes to provide for the indemnification and advancing of expenses to Indemnitee to the maximum extent permitted by law.

E.    In view of the considerations set forth above, the Company desires that Indemnitee be indemnified by the Company as set forth herein.

NOW, THEREFORE, the Company and Indemnitee hereby agree as follows:

1.    Indemnification.

(a)    Indemnification of Expenses.    The Company shall indemnify Indemnitee to the fullest extent permitted by law if Indemnitee was or is or becomes a party to or witness or other participant in, or is threatened to be made a party to or witness or other participant in, any threatened, pending or completed action, suit, proceeding or alternative dispute resolution mechanism, or any hearing, inquiry or investigation that Indemnitee in good faith believes might lead to the institution of any such action, suit, proceeding or alternative dispute resolution mechanism, whether civil, criminal, administrative, investigative or other (hereinafter a “Claim”) by reason of (or arising in part out of) any event or occurrence related to the fact that Indemnitee is or was a director, officer, employee, agent or fiduciary of the Company, or any subsidiary of the Company, or is or was serving at the request of the Company as a director, officer, employee, agent or fiduciary of another corporation, partnership, joint venture, trust or other enterprise, or by reason of any action or inaction on the part of Indemnitee while serving in such capacity (hereinafter an “Indemnifiable Event”) against any

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and all expenses (including attorneys’ fees and all other costs, expenses and obligations incurred in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness in or participate in, any such action, suit, proceeding, alternative dispute resolution mechanism, hearing, inquiry or investigation), judgments, fines, penalties and amounts paid in settlement (if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) of such Claim and any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement (collectively, hereinafter “Expenses”), including all interest, assessments and other charges paid or payable in connection with or in respect of such Expenses. Such payment of Expenses shall be made by the Company as soon as practicable after written demand by Indemnitee therefor is presented to the Company.

(b)    Mandatory Payment of Expenses.    Notwithstanding any other provision of this Agreement other than Section 8 hereof, to the extent that Indemnitee has been successful on the merits or otherwise, including, without limitation, the dismissal of an action without prejudice, in defense of any action, suit, proceeding, inquiry or investigation referred to in Section (1)(a) hereof or in the defense of any claim, issue or matter therein, Indemnitee shall be indemnified against all Expenses incurred by Indemnitee in connection therewith.

2.    Expenses; Indemnification Procedure.

(a)    Advancement of Expenses.    The Company shall advance all Expenses incurred by Indemnitee. Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized hereby. The advances to be made hereunder shall be paid by the Company as soon as practicable after written demand by Indemnitee therefor to the Company.

(b)    Notice/Cooperation by Indemnitee.    Indemnitee shall, as a condition precedent to Indemnitees’ right to be indemnified under this Agreement, give the Company notice in writing as soon as practicable of any Claim made against Indemnitee for which indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the Chief Executive Officer of the Company at the address shown on the signature page of this Agreement (or such other address as the Company shall designate in writing to Indemnitee). In addition, Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitees’ power.

(c)    Procedure.    Any indemnification and advances provided for in Section 1 and this Section 2 shall be made as soon as practicable after receipt of the written request of Indemnitee. If a claim under this Agreement, under any statute, or under any provision of the Company’s Certificate of Incorporation or Bylaws providing for indemnification is not paid in full by the Company as soon as practicable after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 of this Agreement, Indemnitee shall also be entitled to be paid for the Expenses of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for Expenses incurred in connection with any

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action, suit or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee for the amount claimed. However, Indemnitee shall be entitled to receive interim payments of Expenses pursuant to Subsection 2(a) unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the parties’ intention that if the Company contests Indemnitee’s right to indemnification, the question of Indemnitee’s right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including it Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct. In addition to the foregoing, for purposes of this Agreement, the termination of any Claim by judgment, order, settlement (whether with or without court approval) or conviction, or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that Indemnitee did not meet any particular standard of conduct or have any particular belief or that a court has determined that indemnification is not permitted by applicable law.

(d)    Notice to Insurers.    If, at the time of the receipt by the Company of a notice of a Claim pursuant to Section 2(b) hereof, the Company has liability insurance in effect which may cover such Claim, the Company shall give prompt notice of the commencement of such Claim to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such action, suit, proceeding, inquiry or investigation in accordance with the terms of such policies.

(e)    Selection of Counsel.    In the event the Company shall be obligated hereunder to pay the Expenses of any Claim, the Company shall be entitled to assume the defense of such Claim with counsel approved by Indemnitee, which approval shall not be unreasonably withheld, upon the delivery to Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same Claim; provided that, (i) Indemnitee shall have the right to employ Indemnitees’ counsel in any such Claim at Indemnitee’s expense and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there is a conflict of interest between the Company and Indemnitee in the conduct of any such defense, or (C) the Company shall not continue to retain such counsel to defend such Claim, then the fees and expenses of Indemnitee counsel shall be at the expense of the Company. The Company shall have the right to conduct such defense as it sees fit in its sole discretion, including the right to settle any claim against Indemnitee without the consent of the Indemnitee.

3.    Additional Indemnification Rights; Nonexclusivity.

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(a)    Scope.    The Company hereby agrees to indemnify Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company’s Certificate of Incorporation, the Company’s Bylaws or by statute. In the event of any change after the date of this Agreement in any applicable law, statute or rule which expands the right of a Delaware corporation to indemnify a member of its Board of Directors or an officer, employee, agent or fiduciary, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits afforded by such change. In the event of any change in any applicable law, statute or rule which narrows the right of a Delaware corporation to indemnify a member of its Board of Directors or an officer, employee, agent or fiduciary, such change, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement, shall have no effect on this Agreement or the parties’ rights and obligations hereunder except as set forth in Section 8(a) hereof.

(b)    Nonexclusivity.    The indemnification provided by this Agreement shall be in addition to any rights to which Indemnitee may be entitled under the Company’s Certificate of Incorporation, its Bylaws, any agreement, any vote of stockholders or disinterested directors, the General Corporation Law of the State of Delaware, or otherwise. The indemnification provided under this Agreement shall continue as to Indemnitee for any action Indemnitee took or did not take while serving in an indemnified capacity even though Indemnitee may have ceased to serve in such capacity.

4.    No Duplication of Payments.    The Company shall not be liable under this Agreement to make any payment in connection with any Claim made against Indemnitee to the extent Indemnitee has otherwise actually received payment (under any insurance policy, Certificate of Incorporation, Bylaw or otherwise) of the amounts otherwise indemnifiable hereunder.

5.    Partial Indemnification.    If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of Expenses incurred in connection with any Claim, but not, however, for all of the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such Expenses to which Indemnitee are entitled.

6.    Mutual Acknowledgement.    Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors, officers, employees, agents or fiduciaries under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company’s right under public policy to indemnify Indemnitee.

7.    Liability Insurance.    To the extent the Company maintains liability insurance applicable to directors, officers, employees, agents or fiduciaries, Indemnitee shall be covered by such policies in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company’s directors, if Indemnitee is a director; or of the Company’s officers, if Indemnitee is not a director of the Company but is an officer; or of the Company’s key

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employees, agents or fiduciaries, if Indemnitee is not an officer or director but is a key employee, agent or fiduciary.

8.    Exceptions.    Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement:

(a)    Excluded Action or Omissions.    To indemnify Indemnitee for Indemnitee’s acts, omissions or transactions from which Indemnitee may not be relieved of liability under applicable law;

(b)    Claims Initiated by Indemnitee.    To indemnify or advance expenses to Indemnitee with respect to Claims initiated or brought voluntarily by Indemnitee and not by way of defense, except (i) with respect to actions or proceedings brought to establish or enforce a right to indemnification under this Agreement or any other agreement or insurance policy or under the Company’s Certificate of Incorporation or Bylaws now or hereafter in effect relating to Claims for Indemnifiable Events, (ii) in specific cases if the Board of Directors has approved the initiation or bringing of such Claim, or (iii) as otherwise required under Section 145 of the Delaware General Corporation Law, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advance expense payment or insurance recovery, as the case may be;

(c)    Lack of Good Faith.    To indemnify Indemnitee for any expenses incurred by Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by Indemnitee in such proceeding was not made in good faith or was frivolous;

(d)    Claims Under Section 16(b).    To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute; or

(e)    Disgorgement of Profits and Bonuses Following a Restatement.    To indemnifiy Indemnitee for (i) any bonus or other incentive-based or equity-based compensation received by Indemnitee or (ii) any profits arising from the sale of securities made by Indemnitee that in the case of each of clause (e)(i) or (e)(ii) Indemnitee is required pursuant to Section 304 of the Sabarnes-Oxley Act of 2002 to reimburse to the Company.

9.    Period of Limitations.    No legal action shall be brought and no cause of action shall be asserted by or in the right of the Company against Indemnitee, Indemnitee’s estate, spouse, heirs, executors or personal or legal representatives after the expiration of five (5) years from the date of accrual of such cause of action, and any claim or cause of action of the Company shall be extinguished and deemed released unless asserted by the timely filing of a legal action within such five-year period; provided, however, that if any shorter period of limitations is otherwise applicable to any such cause of action, such shorter period shall govern.

10.    Construction of Certain Phrases.

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(a)    For purposes of this Agreement, references to the “Company” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees, agents or fiduciaries, so that if Indemnitee is or was a director, officer, employee, agent or fiduciary of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee, agent or fiduciary of another corporation, partnership, joint venture, employee benefit plan, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued.

(b)    For purposes of this Agreement, references to “other enterprises” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to “serving at the request of the Company” shall include any service as a director, officer, employee, agent or fiduciary of the Company which imposes duties on, or involves services by, such director, officer, employee, agent or fiduciary with respect to an employee benefit plan, its participants or its beneficiaries; and if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have acted in a manner “not opposed to the best interests of the Company” as referred to in this Agreement.

11.    Counterparts.    This Agreement may be executed in one or more counterparts, each of which shall constitute an original.

12.    Binding Effect; Successors and Assigns.    This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors, assigns, including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Company, spouses, heirs, and personal and legal representatives. The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all, or a substantial part, of the business and/or assets of the Company, by written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. This Agreement shall continue in effect with respect to Claims relating to Indemnifiable Events regardless of whether Indemnitee continues to serve as a director, officer, employee, agent or fiduciary of the Company or of any other enterprise at the Company’s request.

13.    Attorneys’ Fees.    In the event that any action is instituted by Indemnitee under this Agreement or under any liability insurance policies maintained by the Company to enforce or interpret any of the terms hereof or thereof, Indemnitee shall be entitled to be paid all Expenses incurred by Indemnitee with respect to such action, regardless of whether Indemnitee is ultimately successful in such action, and shall be entitled to the advancement of Expenses with respect to such action, unless, as a part of such action, a court of competent jurisdiction over such action determines that each of the material assertions made by Indemnitee as a basis for such action was not made in good faith or was frivolous. In the event of an action instituted by or in the name of the Company under

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this Agreement to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all Expenses incurred by Indemnitee in defense of such action (including costs and expenses incurred with respect to Indemnitee counterclaims and cross-claims made in such action), and shall be entitled to the advancement of Expenses with respect to such action, unless, as a part of such action, a court having jurisdiction over such action determines that each of Indemnitee material defenses to such action was made in bad faith or was frivolous.

14.    Notice.    All notices and other communications required or permitted hereunder shall be in writing, shall be effective when given, and shall in any event be deemed to be given (a) five (5) days after deposit with the U.S. Postal Service or other applicable postal service, if delivered by first class mail, postage prepaid, (b) upon delivery, if delivered by hand, (c) one business day after the business day of deposit with Federal Express or similar overnight courier, freight prepaid, or (d) one day after the business day of delivery by facsimile transmission, if delivered by facsimile transmission, with copy by first class mail, postage prepaid, and shall be addressed if to Indemnitee, at the Indemnitee address as set forth beneath Indemnitee signatures to this Agreement and if to the Company at the address of its principal corporate offices (attention: Secretary) or at such other address as such party may designate by ten days’ advance written notice to the other party hereto.

15.    Consent to Jurisdiction.    The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of Delaware for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be commenced, prosecuted and continued only in the Court of Chancery of the State of Delaware in and for New Castle County, which shall be the exclusive and only proper forum for adjudicating such a claim.

16.    Severability.    The provisions of this Agreement shall be severable in the event that any of the provisions hereof (including any provision within a single section, paragraph or sentence) are held by a court of competent jurisdiction to be invalid, void or otherwise unenforceable, and the remaining provisions shall remain enforceable to the fullest extent permitted by law. Furthermore, to the fullest extent possible, the provisions of this Agreement (including, without limitations, each portion of this Agreement containing any provision held to be invalid, void or otherwise unenforceable, that is not itself invalid, void or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.

17.    Choice of Law.    This Agreement shall be governed by and its provisions construed and enforced in accordance with the laws of the State of Delaware, as applied to contracts between Delaware residents, entered into and to be performed entirely within the State of Delaware, without regard to the conflict of laws principles thereof.

18.    Subrogation.    In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee who shall execute all documents required and shall do all acts that may be necessary to secure such rights and to enable the Company effectively to bring suit to enforce such rights.

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19.    Amendment and Termination.    No amendment, modification, termination or cancellation of this Agreement shall be effective unless it is in writing signed by both the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

20.    Integration and Entire Agreement.    This Agreement sets forth the entire understanding between the parties hereto and supersedes and merges all previous written and oral negotiations, commitments, understandings and agreements relating to the subject matter hereof between the parties hereto.

21.    No Construction as Employment Agreement.    Nothing contained in this Agreement shall be construed as giving Indemnitee any right to be retained in the employ of the Company or any of its subsidiaries.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

TRIKON TECHNOLOGIES, INC.
By:	/S/    JOHN MACNEIL
Title:
Ringland Way,
Newport, South Wales
NP18 2T4
United Kingdom

AGREED TO AND ACCEPTED BY:

Signature:	/S/ MARTYN TUFFERY
Name:	Martyn Tuffery
Address:

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EX-10.3

Exhibit 10.3

Ref: CJM/KEH

Martyn Tuffery

Finance

Private and Confidential

5 April 2005

Dear Martyn,

Re: Appointment to position of Finance Director & Acting Chief Financial Officer

I am writing to confirm your appointment to the position of Finance Director and Acting Chief Financial Officer with effect 1 April 2005. Conditions of employment are as follows:

1. Job Title:

Finance Director.

2. Responsible to:

The President & Chief Executive Officer, John Macneil.

3. Salary

£65,000.00 p.a.

4. Notice of Termination of Employment

Each party is required to give the other party 3 months notice of termination of employment.

5. Special Conditions

i. As discussed, you will assume the role of Acting Chief Financial Officer until the merger with Aviza completes. If the merger with Aviza does not complete by 30 September 2005 the situation will be reviewed.

While you are carrying out the role of Acting Chief Financial Officer, you will receive an addition to salary of £1,875.00 per month. This will be paid until the end of the month in which the merger completes.

ii. If the merger with Aviza Technologies completes and you have not given notice of termination of employment, a bonus will be paid to you in accordance with the attached schedule.

6. Start Date

1^st April 2005

Other conditions of employment remain unchanged.

I wish you every success in this position

Yours sincerely,

/s/ Chris J Matthews

CHRISTOPHER J MATTHEWS

Vice President, Human Resources

I have read, understood, and accept the above changes to my conditions of employment.

Signed:	/s/ Martyn Tuffery
	Martyn Tuffery
Date:	6/4/05

Please sign and return one copy of the offer letter.

Martyn Tuffery – Bonus Schedule 2005

If the merger completes on or before 30 June 2005 – 3 months salary

If the merger completes on or before 31 July 2005 – 2 months salary

If the merger completes on or before 31 August 2005 – 1 months salary

No bonus will be payable if the merger does not complete or if it completes after 31 August 2005.

The salary used for calculating this bonus will be the salary including the supplement for carrying out the duties of Acting Chief Financial Officer (£87,500.00 pa).

Chris Matthews

April 2005

EX-10.4

Exhibit 10.4

Dated 31 March 2005

Compromise Agreement

Between

TRIKON TECHNOLOGIES LTD

and

WILLIAM CHAPPELL

Veale Wasbrough

Orchard Court

Orchard Lane

BRISTOL BS1 5WS

Tel: 0117 925 2020

Fax: 0117 925 2025

E-mail: mdavies@vwl.co.uk

www.vwl.co.uk

An Agreement made the 30^th day of March 2005

Between:-

(1) Trikon Technologies Ltd whose registered office is at Ringland Way, Newport, NP18 2TA (“the Company”); and

(2) William Chappell of 9 The Myrtles, Tutshill, Chepstow NP16 7BQ (“the Employee”).

1. The Employee’s employment with the Company will terminate on 31 March 2005 (“the Termination Date”) by reason of resignation.

2 The Employee will return to the Company any property (including documents or copy documents whether in a paper or electronic format) belonging to the Company which is in his possession or control. The Employee will also resign all directorships and other offices held within the Company and/or any other group company and shall agree to execute all necessary documents to this effect.

3 In consideration for this Agreement the Company agrees to accept the Employees resignation without notice. The Company also agrees to make all contractual payments and provide all contractual benefits up to and including the Termination Date.

4 For the avoidance of doubt, the employee agrees that he is not entitled to any bonuses or nay unvested share or stock options.

5 The parties agree to keep the fact and terms of this Agreement strictly confidential except for communications between professional advisers, tax authorities and otherwise as required by law.

6 The parties agree not to make any disparaging or derogatory remarks about each other including in the case of the Employee any such remarks about employees of the Company.

7 The Employee undertakes and agrees that he remains bound by his duty of confidentiality to the Company as a former employee and by the restrictive covenants in his contract of employment dated 12 October 2000. Further and in consideration for the fact that the Company accepts the Employees resignation without notice, the Employee agrees that for a period of 2 years from the Termination Date, he shall not solicit, induce or otherwise entice away from the Company any person engaged or employed in a senior management and/or senior financial position within the Company.

8 The Employee agrees that the terms of this Agreement are in full and final settlement and without admission of liability of all or any claims arising from his employment by the Company or the

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termination thereof that he may have under common law, statute, European legislation or in contract against the Company, any other company in the same group and any shareholders, officers, employees or agents of the Company or of a company in the same group. Such claims include but are not limited to:-

a) breach of contract including wrongful dismissal;

b) statutory or contractual redundancy payments;

c) unfair dismissal;

d) unlawful deduction from wages;

e) any claim under the Trade Union and Labour Relations (Consolidation) Act 1992, Employment Rights Act 1996, National Minimum Wage Act 1998, Working Time Regulations 1998, Employment Relations Act 1999 and Employment Act 2002;

f) any claim under the Equal Pay Act 1970, Sex Discrimination Act 1975, Race Relations Act 1976, Disability Discrimination Act 1995, Employment Equality (Sexual Orientation) Regulations 2003 and Employment Equality (Religion or Belief) Regulations 2003;

g) any claim under any regulations implemented in accordance with any of the Acts listed in e) and f) above.

For the avoidance of doubt this includes any claim relating to unfair dismissal.

9 The claims referred to in clause 7 do not include any claim for latent personal injury or in respect of the Employee’s accrued pension rights.

10 This Agreement satisfies the conditions relating to compromise agreements under the Sex Discrimination Act 1975, Race Relations Act 1976, Trade Union and Labour Relations (Consolidation) Act 1992, Disability Discrimination Act 1995, Employment Rights Act 1996, National Minimum Wage Act 1998, Working Time Regulations 1998, Employment Equality (Sexual Orientation) Regulations 2003 and the Employment Equality (Religion or Belief) Regulations 2003.

11 It is a condition of this Agreement that the Employee has received advice from a relevant independent adviser as defined in section 203 of the Employment Rights Act 1996 acting in a professional capacity relating to the terms and effect of this Agreement and in particular the ability of the Employee to pursue his rights before an employment tribunal. When the relevant independent adviser gave the advice referred to in this clause there was in force a contract of insurance or an indemnity provided for members of a professional body covering the risk of a claim by the Employee arising from that advice. The relevant independent adviser has confirmed the position in this clause by signing Schedule 1.

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12 The Company will contribute up to £250 plus VAT towards the legal costs incurred by the Employee in obtaining advice as to the terms and effect of this Agreement. Payment will be made to the legal adviser direct on receipt by the Company of an invoice addressed to the Employee and marked payable by the Company.

13 The Employee having taken legal advice warrants that he has no claims against the Company, its shareholders, officers, employees or agents, or any companies in the same group or their shareholders, officers, employees or agents except for those referred to in clause 7 above.

14 The Employee’s obligations under this Agreement may be enforced by directors, employees, officers or agents of the Company or by companies within the same group and their directors, employees, officers or agents. No other person shall have the right to enforce any term of this Agreement.

Signed
on behalf of the Company:	/s/ John Macneil
Name:	John Macneil
Position:	CEO
Date:	8th April 2005

Signed
by the Employee:	/s/ William Chappell
Date:	April 8, 2005

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Schedule 1

I confirm to the Company that I am a relevant independent adviser as defined under section 203 of the Employment Rights Act 1996 and that I have given William Chappell the advice referred to in this Agreement. I also confirm the statements made in clause 10.

Signed	/s/ Malcom Reynolds
Name:	M. Reynolds
Address:	Reynolds Galbrath, Solicitors 11/11a Welsh Street Chepstow Monmouthshire NP16 5LN
Date:	8/4/05

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EX-10.5

Exhibit 10.5

Dated 31 March 2005

Trikon Technologies LIMITED

and

William J Chappell

CONTRACT FOR SERVICES

CONTRACT FOR SERVICES

This Agreement is made on March 31 2005

BETWEEN:-

(1) Trikon Technologies Limited (registered number 0137334) whose registered office is at Ringland Way, Newport, NP18 2TA (the “Company”); and

(2) William J Chappell (the “Consultant”).

DEFINITIONS:

“Services” means the services set out in Schedules 1 of this Agreement or such other services as may be agreed from time to time between the Consultant and the Company.

1 Term

The Consultant shall provide the Services from 4 April 2005 until termination of this Agreement as provided in clause 6.

2 Obligations of the Consultant

2.1 The Consultant shall provide the Services at such times as shall be mutually agreed between the parties from time to time.

2.2 The Consultant shall faithfully and diligently perform those duties and exercise such powers consistent with them which are from time to time necessary in connection with the provision of the Services. The Consultant shall devote such of his time as is necessary for the proper provision of the Services.

2.3 The Consultant will, in the provision of the Services, work from such location or site as determined by the Consultant to be appropriate for the proper performance of the contract or as shall be required by the Company from time to time and shall, if required, undertake such travel as may be necessary for the proper provision of the Services. The Consultant shall be responsible for his own travel costs and expenses, which may then be reimbursed by the Company to the Consultant as disbursements chargeable on invoices raised by the Consultant in accordance with the terms agreed.

2.4 The Consultant shall take all reasonable steps to comply with any timetable or deadlines for completion of Services agreed between the parties, either verbally or in writing.

Mutuality of Obligation

2.5 The Company and the Consultant are independent businesses and nothing in this Agreement or by virtue of performing it shall be taken as creating a relationship of agent to principal, employer to employee, partnership or joint venture between them.

2.6 The Consultant is not by entering into this Agreement prevented from undertaking any other activities or accepting other engagements provided that

those activities or other engagements do not interfere with or detract from the provision by him of the Services under this Agreement or harm or prejudice the interests of the Company.

Method of Work

2.7 The Consultant warrants that he will provide the Services using reasonable care and skill, and all such work pursuant to the Services will be carried out to a professional standard, as far as reasonably possible, in accordance with Schedule 1 to this Agreement and any timetables or other deadlines agreed.

2.8 The Consultant’s method of work shall be his own.

2.9 The Consultant shall provide all his own equipment, materials and sundry consumables necessary for the performance of the Services, including but not limited to stationery, office facilities and staff.

2.10 Whilst performing the Services, the Consultant shall:

2.10.1  Familiarise himself and comply with all guidelines issued to the Consultant by the Company from time to time and comply with all such guidelines displayed at any location or site where the Consultant is performing the Services;

2.10.2  Not do anything so as to jeopardise the safety of himself, any workers or contractors at any location or site (whether or not employed or engaged by the Consultant) or members of the public.

2.11 On commencement of this Agreement and prior to performing the Services, the Consultant shall, where required by law, provide the Company with a copy of his own public liability insurance and where appropriate employer liability insurance documents.

3 Payment

3.1 The Company shall be under no obligation to engage the Consultant to provide any Services under this Agreement. If no Services are required by the Company no fees shall be payable except as defined herein.

3.2 If rectification work is required pursuant to clause 2.8, then all such work shall be carried out at the sole expense of the Consultant.

3.3.1 A one off retainer fee of £9,750 will be due on commencement of contract. Worked carried out on behalf of Trikon Technologies Limited will be charged at a rate of £75 per hour. This work will need to be approved in advance by John Macneil, Martyn Tuffery, or a board director.

3.3.2 Where incurred, Trikon will reimburse reasonable expenses associated with carrying out these consultancy services. Travel will be economy class.

All payments to the Consultant will be made on submission of an invoice. The invoice must be addressed to the Company, contain particulars of the Consultant, the site or location at which the Services were performed and dates and details of work performed and VAT number (if any).

3.4 The Consultant shall be responsible for registering and administering VAT as appropriate.

3.5 The company settle within fourteen days of receipt.

4 Success fees

4.1 If the merger between Trikon Technologies and Aviza Technologies completes, and if this agreement has not at that time been terminated by either party, you will receive a single payment as detailed:

4.2 If the merger completes on or before 30 June 2005 the Consultant will receive a payment of £29,000.

4.3 If the merger completes on or before 31 July 2005 the Consultant will receive a payment of £19,000

4.4 If the merger completes on or before 31 August 2005 the Consultant will receive a payment of £9,000.

4.5 There is not success fee payable if the merger does not complete or if it completes after 31 August 2005.

5 Tax and National Insurance

5.1 The Consultant shall be responsible for all income tax liabilities and National Insurance or similar contributions in respect of the fees payable under this Agreement and the Consultant agrees to indemnify and keep indemnified the Company against all claims which may be made by the relevant authorities against the Company in respect of income tax, penalties and interest relating to the provision of the Services hereunder by the Consultant. The client in its sole discretion reserves the right to deduct taxes and other statutory obligations from any payments.

6 Termination

6.1 This Agreement shall continue until 31 August 2005 and may not be terminated earlier save that the company may terminate at any time forthwith by notice in writing if the Consultant:

6.2.1 Commits a breach of this Agreement which in the case of a breach capable of remedy has not been remedied within 5 days of the receipt by the Consultant of a notice from the Company identifying the breach and requiring its remedy;

6.2.2 has a bankruptcy order made against him or compounds with or enter into any voluntary arrangements with his creditors;

6.2.3 acts in any way which may in the opinion of the Board bring the Company into disrepute or discredit, or

6.2.4 is charged with or convicted of any offence involving any act of fraud or dishonesty;

6.2.5 if the Consultant has been unable to provide the Services due to illness or accident for a period of 2 weeks;

6.3 in the event of termination by the company for any of the reasons set out in 6.2 above a portion of the retainer fee of £9,750 paid to the consultant becomes repayable as follows:

If the employer gives the Consultant notice of termination during April 2005 – 100% of the £9,750 retainer is repayable.

If the employer gives the Consultant notice of termination during March 2005 – 80% of the £9,750 retainer is repayable.

If the employer gives the Consultant notice of termination during June 2005 – 60% of the £9,750 retainer is repayable.

If the employer gives the Consultant notice of termination during July 2005 – 40% of the £9,750 retainer is repayable.

If the employer gives the Consultant notice of termination during August 2005 – 20% of the £9,750 retainer is repayable.

6.4 After 31 August 2005 either party may terminate this agreement on giving 5 days notice in writing.

6.5 Upon the termination of this Agreement for whatever reason the Company shall remain liable to pay to the Consultant all sums which have accrued due and owing to the Consultant hereunder.

6.6 Termination of this Agreement for whatever reason shall not affect the accrued rights of the parties arising in any way out of this Agreement as at the date of termination and, in particular but without limitation, the right to recover damages against the other and all provisions which are expressed to survive this Agreement shall remain in force and effect.

7 Indemnity and Insurance

7.1 The Company shall not be liable for any loss, injury or damage suffered by:

7.1.1 the Consultant arising out of or in connection with the provision of the Services; or

7.1.2 any other person where such loss, injury or damage is caused by the Consultant arising out of or in connection with the provision of the Services,

and the Consultant shall indemnify the Company in respect of any such loss, damage or injury (including any claims and expenses arising therefrom).

8 Entire agreement and amendment

8.1 This Agreement embodies the entire agreement and understanding of the parties and supersedes all prior oral or written agreements understandings or arrangements relating to the subject matter of this Agreement. Neither party shall be entitled to rely on any agreement, understanding or arrangement which is not expressly set forth in this Agreement. This Agreement shall not be amended, modified, varied or supplemented except in writing signed by duly authorised representatives of the parties.

8.2 No failure or delay on the part of either party to exercise any right or remedy under this Agreement shall be construed or operated as a waiver thereof nor shall any single or partial exercise of any right or remedy as the case may be. The rights and remedies provided in this Agreement are cumulative and are not exclusive of any rights or remedies provided by law.

8.3 If any provision of this Agreement shall be, or become, void or unenforceable for any reason within any jurisdiction, this shall affect neither the validity of that provision within any other jurisdiction nor any of the remaining provisions of this Agreement.

9. Force majeure

Neither party shall be in breach of this Agreement if there is any total or partial failure of performance by it of its duties and obligations under this Agreement occasioned by any act of God, fire, act of government or state, war, civil

commotion, insurrection, embargo, prevention from or hindrance in obtaining any raw materials, energy or other supplies, labour disputes of whatever nature and any other reason beyond the control of either party. If either party is unable to perform its duties and obligations under this Agreement as a direct result of the effect of one of those reasons that party shall give written notice to the other of the inability stating the reason in question. The operation of this Agreement shall be suspended during the period (and only during the period) in which the reason continues. Forthwith upon the reason ceasing to exist the party relying upon it shall give written advice to the other of this fact.

10 Illegality

If any provision or term of this Agreement or any part thereof shall become or be declared illegal invalid or unenforceable for any reason whatsoever including but without limitation by reason of the provisions of any legislation or other provisions having the force of law or by reason of any decision of any Court or other body or authority having jurisdiction over the parties or this Agreement including the EU Commission and the European Court of Justice such terms or provisions shall be divisible from this Agreement and shall be deemed to be deleted from this Agreement in the jurisdiction in question provided always that if any such deletion substantially affects or alters the commercial basis of this Agreement the parties shall negotiate in good faith to amend and modify the provisions and terms of this Agreement as may be necessary or desirable in the circumstances.

11 Notices

Notices under this agreement are validly servied if delivered or sent by first class post the date of service is the day after posting.

SIGNED by

On behalf of Trikon Technologies Limited

/s/ John Macneil

31/3/05

SIGNED by William J Chappell

/s/ William Chappell

31.3.2005

Schedule 1

The Services

The Services as set out below are to be provided by the Consultant and are to be in accordance with the client’s reasonable requirements.

The Consultant agrees to provide consultancy services specifically on matters associated with the merger between Trikon Technologies and Aviza Technologies but also on other matters that could reasonable be requested of somebody with the Consultant’s skills and knowledge                             :

EX-31.1

EXHIBIT 31.1

Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act

I, John Macneil, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Trikon Technologies, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: June 1, 2005

/s/ John Macneil

John Macneil

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act

I, Martyn John Tuffery, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Trikon Technologies, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: June 1, 2005

/s/ Martyn J. Tuffery

Martyn J. Tuffery

Senior Vice President and Acting Chief Financial Officer

EX-32.1

EXHIBIT 32.1

Certification of Chief Executive Officer furnished pursuant to Section 1350 of Chapter 63 of Title 18 of

the United States Code (18 U.S. C. 1350)

I, John Macneil, the President and Chief Executive Officer of Trikon Technologies, Inc. (the “Company”), do hereby certify to the best of my knowledge and belief that:

1. The Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2005 (the “Report”) fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 780(d)); and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: June 1, 2005

/s/ John Macneil

John Macneil

Chief Executive Officer,

President & Director

EX-32.2

EXHIBIT 32.2

Certification of Chief Financial Officer furnished pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S. C. 1350)

I, Martyn J. Tuffery, the Acting Chief Financial Officer of Trikon Technologies, Inc. (the “Company”), do hereby certify to the best of my knowledge and belief that:

1. The Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2005 (the “Report”) fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 780(d)); and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: June 1, 2005

/s/ Martyn J. Tuffery

Martyn J. Tuffery

Senior Vice President and Acting Chief Financial Officer